January 13, 2015


State & Local Taxes in 2015


Texas Tax Code Features

Progressive Features

• Sales tax base excludes groceries

• Requires the combined reporting for the corporate income tax

Regressive Features

• No personal income tax

• Imposes a gross receipts tax in lieu of a corporate profits tax

• Fails to provide tax credits to low-income taxpayers to offset sales, excise, and property taxes

Tax Changes Enacted in 2013 & 2014

• Increased various credits and sales tax exemptions for businesses

ITEP Tax Inequality Index

According to ITEP’s Tax Inequality Index, Texas has the 3rd most unfair state and local tax system in the country. States with regressive tax structures have negative tax inequality indexes, meaning that incomes are less equal in those states after state and local taxes than before (See Appendix B for state-by-state rankings and more details).

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