Utah

As another polar vortex heads for large swaths of the country, state tax debates this week were highly polarized in another way. Lawmakers and advocates in MICHIGAN, OHIO, OREGON, UTAH, and elsewhere fought to enact or improve state Earned Income Tax Credits to give a boost to low- and middle-income working families. But the opposite extreme was heavily represented as well, as others pushed for regressive tax cuts for wealthy individuals and corporations, including in KANSAS, NEBRASKA, NORTH DAKOTA, OHIO, UTAH, and WEST VIRGINIA. Even our “What We’re Reading” section has informative reading on how education funding policy continues to…

It’s always troubling for those concerned with adequate and fair public finance systems when states prioritize tax cuts at the cost of divesting in important public priorities and exacerbating underlying tax inequalities. But it’s even more nerve-racking when it happens on the eve of what many consider to be an inevitable economic downturn.

In our last update on state responses to the federal tax cut (Tax Cuts and Jobs Act, or TCJA), we noted that several states were waiting until 2019 to make their final decisions, giving them additional time to (hopefully) respond in ways that improve their fiscal situations and upside-down tax codes. The TCJA is affecting the 2018 federal taxes people are filing now, in some cases adding urgency and/or confusion to these debates.

Continuing to build upon the momentum of previous years, states are taking steps to create and improve targeted tax breaks meant to lift their most in-need state residents up and out of poverty. Most notably, a range of states are exploring ways to restore, enhance or create state Earned Income Tax Credits (EITC). EITCs are an effective tool to help struggling families with low wages make ends meet and provide necessities for their children. The policy, designed to bolster the earnings of low-wage workers and offset some of the taxes they pay, allows struggling families to move toward meaningful economic…

Gubernatorial addresses and the prospect of teacher strikes continued to take center stage in state fiscal news this week, as governors of Connecticut, Maryland, and Utah gave speeches that all included significant tax proposals. Meanwhile, teachers walked out in Virginia, and many other states debated school funding increases to avoid similar results. State policymakers have many other debates on their hands as well, including what to do with online sales tax revenue, how to cut property taxes without undermining schools, whether and how to legalize and tax cannabis, and whether to update gas taxes for infrastructure investments.

This week, as Americans in every state celebrated Martin Luther King Jr. Day and reflected on his dream of peaceful protest and racial and economic justice, many eyes were on the teachers’ strike pressing for parts of this dream amid the “curvaceous slopes of California.” Governors and lawmakers in many states—including Arizona, Georgia, Indiana, Louisiana, Nevada, New Mexico, South Carolina, and Wisconsin—discussed ways to raise pay for teachers and/or enhance education investments generally.

This week we released a handy guide of policy options for Moving Toward More Equitable State Tax Systems, and are pleased to report that many state lawmakers are promoting policies that are in line with our recommendations. For example, Puerto Rico lawmakers recently enacted a targeted EITC-like credit for working families, and leaders in Virginia and elsewhere are working toward similar improvements. Arkansas residents also saw their tax code improve as laws reducing regressive consumption taxes and enhancing income tax progressivity just went into effect. And there is still time for governors and legislators pushing for regressive income tax cuts…

With many people enjoying time off over the next couple weeks, and the longest nights of the year coming over the weekend, now is a good time to get plenty of rest and relaxation in advance of what is likely to be a very busy 2019 for state fiscal policy and other debates. Among those debates, Kentucky lawmakers will be returning to topics they could not resolve in a brief special session held this week, New Jersey and New York will both be deciding how to legalize and tax cannabis, and gas tax updates will be on the agenda in…

State lawmakers are preparing their agendas for 2019 and looking at all sorts of tax and budget policies in the process, raising many familiar questions. Oregon legislators, for example, will try to fill in the blanks in a proposal to boost investments in education that left out detail on how to fund them, while their counterparts in Texas face the inverse problem of a proposed property tax cut that fails to clarify how schools could be protected from cuts. Similar school finance debates will play out in many other states. Alabama, Kansas, and Louisiana will look at gas tax updates,…

Policymakers and residents in all 50 states and the District of Columbia got new ITEP data this week on how their tax structures and decisions affect their high-, middle-, and low-income residents. As our “Who Pays?” report outlines, most state and local tax codes exacerbate economic inequalities and all states have room to improve. The data can serve as an important informative backdrop to all state and local tax policy debates, such as whether to change the valuation of commercial property in California, how to improve funding for early childhood education in Indiana, and how to evaluate tax-related ballot measures…

UTAH Read as PDF UTAH 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 4% Top 1% Income Range Less than $22,900 $22,900 to $39,600 $39,600 to $63,900 $63,900 to $104,300 $104,300 to $202,400 $202,400 to $486,500 over $486,500 […]

The IRS recently proposed a commonsense improvement to the federal charitable deduction. If finalized, the regulation would prevent not just the newest workarounds to the $10,000 deduction for state and local taxes (SALT), but also a longer-running tax shelter abused by wealthy donors to private K-12 school voucher programs. ITEP has submitted official comments outlining four key recommendations related to the proposed regulation.

The $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 “Tax Cuts 2.0” or “Tax Reform 2.0,” which would make the temporary provisions permanent. And they falsely claim that making these provisions permanent will benefit […]

Affordable housing efforts made news in Minnesota and Virginia this week, as tax breaks for homeowners and other victims of Hurricane Florence were made available in multiple states. Meanwhile, New Jersey is still looking into legalizing and taxing cannabis, and Wyoming continues to consider a corporate income tax. And gubernatorial candidates and ballot initiative efforts will give voters in many states much to consider in the November elections.

Consumers’ growing interest in online shopping and “gig economy” services like Uber and Airbnb has forced states and localities to revisit their sales taxes, for instance. Meanwhile new evidence on the dangers and causes of obesity has led to rising interest in soda taxes, but the soda industry is fighting back. Carbon taxes are being discussed as a tool for combatting climate change. And changing attitudes toward cannabis use have spurred some states to move away from outright prohibition in favor of legalization, regulation and taxation.

In the wake of the U.S. Supreme Court's recent Wayfair decision authorizing states to collect taxes owed on online sales, Utah lawmakers held a one-day special session that included (among other tax topics) legislation to ensure the state will be ready to collect those taxes, and a Nebraska lawmaker began pushing for a special session for the same reason. Voters in Colorado and Montana got more clarity on tax-related items they'll see on the ballot in November. And Massachusetts moves closer toward becoming the final state to enact a budget for the new fiscal year that started July 1 in…

With many state fiscal years beginning July 1, most states that will make decisions this year about federal tax conformity have now done so, so it is now time for an update on how well state policymakers have kept to, or veered from, the path we charted out earlier this year. Most states that have enacted laws in response to the federal changes have adhered to some but not all of the principles we laid out, with a few responding rather prudently and a handful charting a much more treacherous course of unfair, unsustainable policy based on unfounded promises of…

South Carolina legislators will return next week to try to finalize a few issues before the end of their session and fiscal year on June 30th, including the question of how to respond to the federal Tax Cuts and Jobs Act (TCJA). That's a short timeframe with some important questions at stake, and some misinformation has been spread, so here's a quick guide to the facts, issues, and options.

The U.S. Supreme Court made big news this morning by allowing states to collect taxes due on internet purchases, which will help put main-street and online retailers on an even playing field while also improving state and local revenues and the long-term viability of the sales tax as a revenue source. Many states remain focused on more local issues, however, as Louisiana's third special session of the year kicked off, Massachusetts won a living wage battle while losing an opportunity to put a popular millionaires tax proposal before voters, and major fiscal debates continue in Maine, New Jersey, and Vermont.

Many state legislators and regulators are considering expanding state-sponsored gambling by allowing betting on major league sports games. But the revenue states could bring in isn’t worth the risk.

Cash-strapped, tax-averse state lawmakers continue to seek unconventional revenue-raising alternatives to the income, sales, and property taxes that form the backbone of most state tax systems. However, gambling revenues are rarely as lucrative, or as long-lasting, as supporters claim.

This week, Virginia lawmakers overcame their budget impasse and approved an expansion of Medicaid, North Carolina's behind closed doors budget debate appears to be wrapping up, and Vermont's special session continues in the wake of the governor's vetoes of the state budget and accompanying tax bills. New research highlighted in our What We're Reading section shows that both corporate income tax cuts and business tax subsidies contribute to wider economic inequality. And the possible reconstitution of a federal commission on intergovernmental relations could not come soon enough, as other headlines this week include a state-to-local shift in school funding, governments…

This week the governors of Louisiana and Minnesota both vetoed budget bills, leading to another special session in Louisiana and unanswered questions in Minnesota, and Missouri legislators managed to push through a tax shift bill just before adjourning their regular session and heading right into a special session to impeach their governor. Wisconsin and Wyoming localities are both looking at ways to raise revenues as state funding drops. And our What We're Reading section contains helpful pieces on changing demographics, the effects of wealth inequality on families with children, and the impacts of the Supreme Court sports gambling and online…