ITEP Work in Action August 25, 2020
Keystone Research Center: REPORT: Why Pennsylvania Needs a State Earned Income Tax Credit (EITC)If one thing has become clear during the COVID-19 pandemic, it is that workers who do essential things like providing care for the sick, stocking shelves at grocery stores, and…
ITEP Work in Action April 15, 2019
Pennsylvania Budget and Policy Center: A Fair Share Tax Plan for Pennsylvania — 2019 UpdateThis paper puts forward the Fair Share Tax plan, a major step toward fixing Pennsylvania’s broken tax system and raising the revenues we need to invest in the public goods…
ITEP Work in Action October 23, 2018
Third and State: Pennsylvania’s Terrible Tax Code Asks More of You as You Make Less: Hitting Community’s of Color Especially Hard
The Commonwealth once again claims its spot in the “Terrible 10” most unfair tax structures in the nation. The lowest 20% of income earners in the state pays more than double (2.3 times) their share of family income on state and local taxes than the top 1%.
October 17, 2018
Pennsylvania: Who Pays? 6th EditionPENNSYLVANIA Read as PDF PENNSYLVANIA STATE AND LOCAL TAXES Taxes as Share of Family Income Top 20% Income Group Lowest 20% Second 20% Middle 20% Fourth 20% Next 15% Next…
blog October 2, 2018
Twelve States Offer Profitable Tax Shelter to Private School Voucher Donors; IRS Proposal Could Fix This
A proposed IRS regulation would eliminate a tax shelter for private school donors in twelve states by making a commonsense improvement to the federal tax deduction for charitable gifts. For years, some affluent taxpayers who donate to private K-12 school voucher programs have managed to turn a profit by claiming state tax credits and federal tax deductions that, taken together, are worth more than the amount donated. This practice could soon come to an end under the IRS’s broader goal of ending misuse of the charitable deduction by people seeking to dodge the federal SALT deduction cap.
September 26, 2018
Tax Cuts 2.0 – PennsylvaniaThe $2 trillion 2017 Tax Cuts and Jobs Act (TCJA) includes several provisions set to expire at the end of 2025. Now, GOP leaders have introduced a bill informally called…
ITEP Work in Action August 30, 2018
Keystone Research: The State of Working Pennsylvania 2018
“The State of Working Pennsylvania 2018,” Keystone Research Center’s 23rd annual review of the Pennsylvania economy and labor market finds that, nearly a decade into the current national economic expansion, many Pennsylvania workers are still waiting for a raise. The report points to three factors that help explain this.
report June 27, 2018
The Other SALT Cap Workaround: Accountants Steer Clients Toward Private K-12 Voucher Tax CreditsOn May 23, 2018, the IRS and Treasury Department announced that they “intend to propose regulations addressing the federal income tax treatment of certain payments made by taxpayers for which…
blog May 22, 2018
Most States Have Raised Gas Taxes in Recent Years
An updated version of this blog was published in April 2019.
State tax policy can be a contentious topic, but in recent years there has been a remarkable level of agreement on one tax in particular: the gasoline tax. Increasingly, state lawmakers are deciding that outdated gas taxes need to be raised and reformed to fund infrastructure projects that are vital to their economies.
ITEP Work in Action January 27, 2018
Third and State: Fact Check: Undocumented Immigrants like the Dreamers are not a Drag on State and Local GovernmentsA recent study by the Institute on Tax and Economic Policy (ITEP) shows that the estimated 137,000 undocumented immigrants in Pennsylvania pay our state and local governments almost $135 million…
ITEP Work in Action January 22, 2018
Pennsylvania Budget and Policy Center: The Pennsylvania Promise: Making College Affordable and Securing Pennsylvania’s Economic Future
Three recent briefs by the Keystone Research Center laid out the case for more affordable access to post-secondary education in Pennsylvania. The global race for raising incomes and increasing opportunity hinges critically on access to post-secondary education and training. If Pennsylvania does not expand access to higher education to more of its citizens, the Commonwealth’s economy will suffer and living standards will lag behind growth elsewhere. With a modest and smart investment, Pennsylvania can build a more prosperous future for its citizens and reinvigorate the American Dream in every corner of the keystone state. “The Pennsylvania Promise,” outlined below, shows how.
December 16, 2017
How the Final GOP-Trump Tax Bill Would Affect Pennsylvania Residents’ Federal TaxesThe final tax bill that Republicans in Congress are poised to approve would provide most of its benefits to high-income households and foreign investors while raising taxes on many low-…
blog December 14, 2017
Private Schools Donors Likely to Win Big from Expanded Loophole in Tax Bill
For years, private schools around the country have been making an unusual pitch to prospective donors: give us your money, and you’ll get so many state and federal tax breaks in return that you may end up turning a profit. Under tax legislation being considered in Congress right now, that pitch is about to become even more persuasive.
report December 14, 2017
Tax Bill Would Increase Abuse of Charitable Giving Deduction, with Private K-12 Schools as the Biggest Winners
In its rush to pass a major rewrite of the tax code before year’s end, Congress appears likely to enact a “tax reform” that creates, or expands, a significant number of tax loopholes. One such loophole would reward some of the nation’s wealthiest individuals with a strategy for padding their own bank accounts by “donating” to support private K-12 schools. While a similar loophole exists under current law, its size and scope would be dramatically expanded by the legislation working its way through Congress.
December 6, 2017
How the House and Senate Tax Bills Would Affect Pennsylvania Residents’ Federal Taxes
The House passed its “Tax Cuts and Jobs Act” November 16th and the Senate passed its version December 2nd. Both bills would raise taxes on many low- and middle-income families in every state and provide the wealthiest Americans and foreign investors substantial tax cuts, while adding more than $1.4 trillion to the deficit over ten years. The graph below shows that both bills are skewed to the richest 1 percent of Pennsylvania residents.
November 14, 2017
How the Revised Senate Tax Bill Would Affect Pennsylvania Residents’ Federal Taxes
The Senate tax bill released last week would raise taxes on some families while bestowing immense benefits on wealthy Americans and foreign investors. In Pennsylvania, 50 percent of the federal tax cuts would go to the richest 5 percent of residents, and 12 percent of households would face a tax increase, once the bill is fully implemented.
November 6, 2017
How the House Tax Proposal Would Affect Pennsylvania Residents’ Federal Taxes
The Tax Cuts and Jobs Act, which was introduced on November 2 in the House of Representatives, includes some provisions that raise taxes and some that cut taxes, so the net effect for any particular family’s federal tax bill depends on their situation. Some of the provisions that benefit the middle class — like lower tax rates, an increased standard deduction, and a $300 tax credit for each adult in a household — are designed to expire or become less generous over time. Some of the provisions that benefit the wealthy, such as the reduction and eventual repeal of the estate tax, become more generous over time. The result is that by 2027, the benefits of the House bill become increasingly generous for the richest one percent compared to other income groups.
October 4, 2017
GOP-Trump Tax Framework Would Provide Richest One Percent in Pennsylvania with 61.5 Percent of the State’s Tax Cuts
The “tax reform framework” released by the Trump administration and congressional Republican leaders on September 27 would not benefit everyone in Pennsylvania equally. The richest one percent of Pennsylvania residents would receive 61.5 percent of the tax cuts within the state under the framework in 2018. These households are projected to have an income of at least $550,200 next year. The framework would provide them an average tax cut of $67,970 in 2018, which would increase their income by an average of 3.8 percent.
blog September 13, 2017
State Rundown 9/13: The Year of Unprecedented State Budget Impasses Continues
This week, Pennsylvania lawmakers risk defaulting on payments due to their extremely overdue budget and Illinois legislators will borrow billions to start paying their backlog of unpaid bills. Governing delves into why there were more such budget impasses this year than in any year in recent memory. And Oklahoma got closure from its Supreme Court on whether closing special tax exemptions counts as “raising taxes” (it doesn’t).
blog September 7, 2017
State Rundown 9/6: Most Statehouses Quiet, Many Pondering Harvey’s Impacts
It’s been a quiet week for tax policy in most states, though lawmakers are still making noise in Pennsylvania, where a budget agreement is still needed, and in Wisconsin, where legislators are searching for the will to raise revenue for the state’s ailing transportation infrastructure. In our “What We’re Reading” section you’ll find interesting reading on the fiscal fallout of Hurricane Harvey, as well as an in-depth series on how states’ disaster response needs are likely to continue to increase.
blog August 23, 2017
State Rundown 8/23: Few Lingering Budget Debates Cannot Linger Much Longer
This week, Oklahoma lawmakers learned they’ll need to enter a special session to balance their budget and that they’ll likely face a lawsuit over their low funding of public education. Pennsylvania’s budget stalemate is also coming to a head as the state literally runs out of funds to pay its bills. And Amazon’s tax practices are in the news again as the company has been sued in South Carolina.
August 17, 2017
In Pennsylvania 43.5 Percent of Trump’s Proposed Tax Cuts Go to People Making More than $1 Million
A tiny fraction of the Pennsylvania population (0.5 percent) earns more than $1 million annually. But this elite group would receive 43.5 percent of the tax cuts that go to Pennsylvania residents under the tax proposals from the Trump administration. A much larger group, 44.9 percent of the state, earns less than $45,000, but would receive just 5.7 percent of the tax cuts.
blog August 2, 2017
State Rundown 8/2: Legislative Tax Debates Wind Down as Ballot Initiative Efforts Ramp Up
Budget deliberations continue in earnest this week in Alaska, Connecticut, Pennsylvania, and Rhode Island. In South Dakota and Utah, the focus is on gearing up for ballot initiative efforts to raise needed revenue, though be sure to read about legislators nullifying voter-approved initiatives in Maine and elsewhere in our “what we’re reading” section.
July 20, 2017
Trump Tax Proposals Would Provide Richest One Percent in Pennsylvania with 50.2 Percent of the State’s Tax Cuts
Earlier this year, the Trump administration released some broadly outlined proposals to overhaul the federal tax code. Households in Pennsylvania would not benefit equally from these proposals. The richest one percent of the state’s taxpayers are projected to make an average income of $1,780,400 in 2018.
blog July 19, 2017
State Rundown 7/19: Handful of States Still Have Their Hands Full with Tax and Budget Debates
Tax and budget debates drag on in several states this week, as lawmakers continue to work in Alaska, Connecticut, Rhode Island, Pennsylvania, Texas, and Wisconsin. And a showdown is brewing in Kentucky between a regressive tax shift effort and a progressive tax reform plan. Be sure to also check out our “What We’re Reading” section for a historical perspective on federal tax reform, a podcast on lessons learned from Kansas and California, and more!