State Budget and Tax Archive
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Relief for States and Struggling Families Provides Substantial Boost to Employment
November 20, 2009
The economy is in a very deep hole and faces a long climb back to full employment. Policymakers can make that climb easier by extending or bolstering key provisions of the American Recovery and Reinvestment Act (ARRA) enacted at the start of the year — particularly those related to unemployment insurance and state … -
Additional Federal Fiscal Relief Needed to Help States Address Recession’s Impact
Updated November 19, 2009
States face a serious fiscal problem that could force them to institute additional deep budget cuts and tax increases in 2010, weakening the fragile economic recovery and harming vulnerable children, seniors, and people with disabilities, among others. The federal assistance that states received for their Medicaid programs … -
An Update on State Budget Cuts
Updated November 19, 2009
With tax revenue declining as a result of the recession and budget reserves largely drained, the vast majority of states are making spending cuts that hurt families and reduce necessary services. These cuts, in turn, will make the recession worse because families and businesses have less to spend in their local economies. … -
Policy Points: Recession Still Causing Trouble for States
Updated November 19, 2009
The weak economy continues to cause great fiscal distress among states. New budget gaps have opened up in many states for the current fiscal year (July 1 marked the start of 2010 for most states). The budget gaps for this year and next year combined are estimated to total more than $350 … -
Recession Continues to Batter State Budgets; State Responses Could Slow Recovery
Updated November 19, 2009
The worst recession since the 1930s has caused the steepest decline in state tax receipts on record. As a result, even after making very deep cuts, states continue to face large budget gaps. New shortfalls have opened up in the budgets of at least 35 states for the current fiscal year (FY 2010, which began July 1 in … -
Amazon’s Arguments Against Collecting Sales Taxes Do Not Withstand Scrutiny
November 16, 2009
The Internet retailer Amazon.com has offered two primary justifications for opposing efforts of a growing number of states to require the company and other online retailers to charge sales tax. Amazon officials have argued that collecting sales taxes would be administratively burdensome. They have also claimed that the … -
How Much Would a State Earned Income Tax Credit Cost in 2010?
November 12, 2009
The federal Earned Income Tax Credit (EITC) is the nation’s most effective anti-poverty program for working families, lifting 6.5 million people — including 3.3 million children — above the poverty line each year.[1] The 24 state-level EITCs modeled after the federal program complement it in combating … -
Video: CNN cites CBPP on Potential Job Losses Due to State Budget Cuts
November 12, 2009
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Podcast: State Budget Cuts and Tax Increases Put Fragile Economic Recovery at Risk
November 11, 2009
The risk that, without more federal aid, states efforts to address their budget problems could cost the economy 900,000 jobs is discussed by Bob Greenstein, Mark Zandi, chief economist of economy.com, and Senior Advisor Iris Lav.
Duration: 21:42
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Raising State Income Taxes on High-Income Taxpayers
Revised November 11, 2009
As states face increasingly difficult choices for closing the gap between available resources and the cost of needed programs and services, one potential revenue source can be found at the high end of the income tax spectrum. The personal income tax, a major source of revenue for 41 states, can yield a significant amount of money from small rate increases … -
State Earned Income Tax Credits: 2009 Legislative Update
November 10, 2009
An Earned Income Tax Credit (EITC) modeled on the federal program of the same name is now offered in 23 states and the District of Columbia as a way to reduce taxes and supplement wages for low- and moderate-income working families. A large body of evidence has shown that the state and federal EITCs serve a number of important … -
Podcast: Maine and Washington Reject TABOR
November 5, 2009
Senior advisor Iris Lav discusses voters’ rejection of TABOR — a strict state spending restriction — in Washington and Maine, and the implications for other states.
Duration: 4:00
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Video: NBC affiliate WVTM in Birmingham, Alabama Cites CBPP on State Income Tax Threshold
November 4, 2009
NBC affiliate WVTM in Birmingham, Alabama Cites CBPP on State Income Tax Threshold
Duration: 0:30
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Statement: Iris Lav, Senior Advisor, on Defeat of “TABOR” Initiatives In Maine and Washington
November 4, 2009
Yesterday’s votes in Maine and Washington show clearly that TABOR’s crippling and arbitrary spending limits remain unpopular around the country. Anti-government groups have made serious efforts to enact TABORs in 20 states since 2004 — and they have failed every time. … -
The Impact of State Income Taxes on Low-Income Families in 2008
November 4, 2009
While some working-poor families get help lifting themselves out of poverty through exemptions from state income taxes, in many states they continue to face substantial state income tax liability. An analysis of state income tax systems for the 2008 tax year shows that: In 16 of the 42 states that levy income taxes, two-parent … -
Press Release: State Income Taxes Push Many Working-Poor Families Deeper Into Poverty
November 4, 2009
Sixteen states taxed working-poor families deeper into poverty last year, according to a new report from the Center on Budget and Policy Priorities. Income tax bills on poor families in those 16 states ranged from a few dollars to several hundred dollars, which is a significant amount for a family struggling to make ends meet, the report said. … -
Which States Tax the Sale of Food for Home Consumption in 2009?
Revised November 4, 2009
Forty-five states and the District of Columbia levy general sales taxes. Most of those states have eliminated, reduced, or offset the tax as applied to food for home consumption. The relief strategies include full or partial exemptions from the sales tax for food purchased for home consumption and credits or rebates to offset the food tax. Of … -
Video: Michael Mazerov Discusses Closing Pennsylvania Corporate Tax Loopholes on WGAL TV
November 2, 2009
Duration: 3:32
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The Administration’s October 30 Data Release on Jobs Created by the Economic Recovery Law: What it Will Tell Us and What it Won’t
October 28, 2009
The Obama Administration’s October 30 release of data on jobs created and saved by the American Recovery and Reinvestment Act (ARRA), which the Administration and Congress enacted early this year, will capture only a portion of the jobs created and saved due to ARRA’s limited reporting requirements. ARRA’s … -
TABOR Has Hampered Economic Growth and Reduced Quality of Life in Colorado
October 19, 2009
On October 12, the Maine Heritage Policy Center released a report that touted Colorado’s prosperity and claimed that its prosperity was the result of TABOR – ostensibly “refuting” the Center on Budget and Policy Priorities work showing that TABOR has been detrimental to Colorado. (Question 4, a TABOR … -
I-1033's Problematic Measure of Inflation
October 15, 2009
Each year, the cost of providing health care, education, roads and other services rises. As a result, state and local governments have to spend more to provide the same level of services. Washington’s Initiative 1033 would dictate the amount of these increases in spending based not on the actual cost of those services, … -
Video: Nick Johnson Discusses State Budgets Problems on Fox News
October 10, 2009
Iowa is just one of many states with serious budget problems. Steve Brown reports on expected job loss and cuts in 2010 and 2011; commentary by Nick Johnson.
Duration: 1:54
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A Formula for Decline: Lessons from Colorado for States Considering TABOR
Updated October 9, 2009
Colorado’s so-called Taxpayer Bill of Rights, or TABOR, has contributed to a significant decline in that state’s public services. This decline has serious implications not only for the 4.6 million residents of Colorado, but also for the many millions of residents of other states in which TABOR-like measures are now being promoted. TABOR, … -
Podcast: TABOR’s Harmful Effect on States
October 8, 2009
Robb Gray, the Center’s state project coordinator, explains TABOR, a strict state spending restriction, and its harmful effect on states.
Duration: 4:47
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Fact Sheet: TABOR Will Not Improve Maine’s Business Climate
October 7, 2009
Colorado, the only state with a TABOR, has an economy that is stronger than Maine’s. However, that has nothing to do with TABOR. The strength of Colorado’s economy is largely a legacy of a post World War II public investment boom by the military and federal government. The federal investment left Colorado with a strong infrastructure of high-tech firms … -
Correcting Five Myths About the Stimulus Bill
Updated September 23, 2009
Some critics of the economic recovery law (or “stimulus” bill) that President Obama and Congress enacted early this year continue to mischaracterize how it was supposed to work and what it was supposed to do. For instance, some critics complain that, because unemployment has risen in recent months, the law is not working. Others claim … -
Maine’s “TABOR II” Repeats Mistakes of Colorado, Endangers Public Services and Business Climate
September 22, 2009
Maine’s 2009 ballot initiative, “An Act to Promote Tax Relief” (known as TABOR II), imposes tight restrictions on expenditures for the broad range of state and local services that help support Maine’s economy and quality of life. The spending growth permitted under TABOR does not allow for … -
Press Release: “TABOR II” Would Harm Maine’s Economy, Businesses, and Families
September 22, 2009
Maine’s efforts to improve its business climate and recover from the recession would be hindered if voters adopt the proposed Taxpayer Bill of Rights (TABOR) that is on the ballot in Maine this November, according to a new report from the Center on Budget and Policy Priorities. … -
Banning Taxation of Online Hotel Reservations Is Unwarranted and Could Cost States and Localities Billions of Dollars
Revised September 18, 2009
For the past two years, online travel companies like Expedia and Priceline have been seeking enactment of federal legislation that would ban state and local taxation of hotel room rentals when booked by such a company or by a conventional travel agent. Most recently, the legislation was circulated as a potential amendment to … -
Policy Basics: State Earned Income Tax Credits
Updated August 27, 2009
Twenty-four states (counting the District of Columbia) have created earned income tax credits (EITCs) to reduce the burden that state taxes can place on low- and moderate-income working families. These credits complement the federal EITC, which helps offset these families’ federal taxes. … -
Expanding Sales Taxation of Services: Options and Issues
August 10, 2009
Sales of tangible goods dominate most states’ sales tax bases; only a few states impose their sales taxes on a broad array of services. Sales of “non-durable goods” like clothing and light bulbs and “durable goods” like cars and computers generate the vast majority of state sales tax receipts. According to the … -
Press Release: Facing Deficits, More States Considering Taxing Services
August 10, 2009
Broadening the sales tax base to encompass more services, a step that tax experts have long recommended to modernize state tax systems, is receiving renewed attention because of the state fiscal crisis, according to a major new report from the Center on Budget and Policy Priorities. The report provides state-specific information on what … -
New York’s “Amazon Law”: An Important Tool for Collecting Taxes Owed on Internet Purchases
July 23, 2009
The inability to collect all sales taxes that are legally due on purchases made over the Internet costs states billions of dollars a year in lost revenue. In 2008, New York State enacted an innovative law that helps to address this problem. Rhode Island adopted a similar measure this year. All states with sales taxes should … -
Myths and Realities About How States Are Using Economic Recovery Act Funds
July 9, 2009
Two major misconceptions about how state governments are using funds from the economic recovery law that President Obama and Congress enacted early this year are contributing to a broader misunderstanding about whether the law is, in fact, helping the U.S. economy. Evidence that includes a major new report from the Government Accountability Office (GAO) … -
Tax Measures Help Balance State Budgets
Updated July 9, 2009
With the recession continuing to widen the gap between shrinking revenues and residents’ increasing need for services, a growing number of states are adopting a balanced approach to their budgets that includes revenue increases as well as spending cuts. Since January 1, 30 states have raised taxes and another seven states are considering doing … -
Video: CNN cites CBPP on State Budget Cuts
July 5, 2009
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Video: Jon Shure Talks About the State Budget Crisis on CSPAN's Washington Journal
July 2, 2009
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Audio Clip: Bloomberg Radio Interviews Iris Lav on the State Budget Crisis
July 1, 2009
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Video: CNN Interviews Jon Shure on the State Budget Crisis
July 1, 2009
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Federal Fiscal Relief Is Working As Intended
Updated June 29, 2009
As dire as the states’ fiscal condition is — with dramatic revenue downturns leading in some cases to unprecedented service cuts — evidence shows this bad situation would be substantially worse if not for federal recovery assistance. The $787 billion American Recovery and Reinvestment Act package enacted in February included about $140 billion for states … -
Press Release: New Fiscal Year Brings Painful Spending Cuts, Continued Budget Gaps In Almost Every State
June 29, 2009
The 2010 fiscal year begins for most states July 1. It brings an austere continuation of recession-driven cuts in essential services and poor prospects for improvement through 2011, according to a series of updated reports on state budget conditions issued today by the Center on Budget … -
Audio Clip: Nick Johnson, Director of the State Fiscal Project, Discusses State Budgets on NPR’s The Diane Rehm Show
June 25, 2009
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Video: Fox Business Interviews Jon Shure on State Budget Problems
June 22, 2009
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Video: CNN cites CBPP on States Balancing Budgets with Tax Measures
May 22, 2009
“The Center on Budget and Policy Priorities argues, ‘Listen, cutting services is even more painful for lower-income families than raising taxes.’ They also say those tax increases can target the wealthy. And that’s exactly what we’re seeing…” -
Video: Fox News Channel Interviews Elizabeth McNichol on State Budget Troubles
May 22, 2009
“…A study from the Center on Budget and Policy Priorities reveals 47 of the 50 states are facing substantial budget gaps this year…. All told, the states are nearly $60 billion in the hole for 2009. Next year, the gap will grow to $133 billion. Experts say it won't … -
Video: NBC Nightly News Cites CBPP on State Budget Troubles
May 22, 2009
“The Center on Budget estimates that in 2010 47 states will face deficits totaling $145 billion.” -
Obscure Tax Provision of Federal Recovery Package Could Widen State Budget Gaps
May 19, 2009
States could lose up to $5.5 billion in business income tax revenues over the next three years as a result of a little-known provision in the federal economic recovery package enacted in February. States can, however, easily avoid this revenue loss by making offsetting changes in their tax laws. For states to allow … -
Press Release: More States Are Raising Revenues to Help Close Budget Gaps
May 13, 2009
As tax revenues continue to fall dramatically, making a prolonged budget crisis likely, more states are raising revenues, or considering doing so, to help maintain important services, according to one of a series of updated reports on state budget conditions that the Center on Budget and … -
Minority of States Still Granting Net Operating Loss “Carryback” Deductions Should Eliminate Them Now
Revised May 11, 2009
As a result of the current recession, nearly all states are experiencing the most serious fiscal crisis of at least the last 25 years. Many are already being forced to cut vital services, lay off employees, increase taxes and college tuitions, and tap reserves. In this context, they can ill-afford maintaining any … -
Podcast: Where Do Our State Tax Dollars Go?
May 6, 2009
Given the budget problems states face due to the recession, policymakers will confront important choices about how to pay for important government services and programs. To inform this crucial decision making, it is useful to examine where state tax dollars go as well as changing trends over time.
Duration: 5:35
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Policy Basics: Where Do Our State Tax Dollars Go?
April 13, 2009
Given the budget problems states face due to the recession, policymakers will confront important choices about how to pay for important government services and programs. To inform this crucial decision making, it is useful to examine where state tax dollars go … -
State Taxes On Inherited Wealth Remain Common
Revised April 10, 2009
Taxes on inherited wealth are a traditional and common revenue source for states. Prior to the passage of the federal estate tax cut in 2001, every state levied an estate tax that allowed them to “pick-up” a share of federal estate tax revenues. The state “pick-up” estate taxes did not increase total estate tax … -
Promoting State Budget Accountability Through Tax Expenditure Reporting
April 9, 2009
Executive Summary Each year states spend tens, maybe hundreds, of billions of dollars on “tax expenditures.” Tax expenditures are tax credits, deductions, and exemptions that reduce state revenue. They can include everything from poverty-reducing tax credits, to middle-class benefits, to corporate subsidies. Tax expenditures cost state treasuries money in … -
Reforming the Tax Treatment of S-Corporations and Limited Liability Companies Can Help States Finance Public Services
April 8, 2009
Nineteen states impose only nominal taxes on businesses organized as subchapter S Corporations (S-Corps) or Limited Liability Companies (LLCs) even though these entities — which generate about one-fourth of all business receipts — benefit from state services just as businesses that are subject to state corporate income taxes do. In addition, many … -
A Majority of States Have Now Adopted a Key Corporate Tax Reform — “Combined Reporting”
Revised April 3, 2009
A growing number of states are adopting a major reform in their corporate income taxes long advocated by state tax experts: “combined reporting.” With the recent enactment of combined reporting legislation in Wisconsin, 23 of the 45 states with corporate income and similar business … -
Tax Foundation Figures Do Not Represent Typical Households’ Tax Burdens
March 31, 2009
Each year, the Tax Foundation releases a report projecting “Tax Freedom Day,” which it describes as the day when Americans will have “earned enough money to pay this year’s tax obligations at the federal, state, and local levels.” [1] The Tax Foundation’s “Tax … -
If States Fail to Use Stimulus Funds as Intended, Efforts to Strengthen Economy Could Be Undercut
February 24, 2009
A few governors and legislative leaders have suggested that their states might not accept the full amount of fiscal relief in the new recovery legislation or might use the funds to finance tax cuts or build up reserves, rather than spend them as Congress intended.[1] Such actions could weaken the new law’s impact, and possibly even … -
Funding For States in Economic Recovery Package Will Close Less Than Half of State Deficits
February 20, 2009
The state fiscal situation is dire. Revenues are declining, and the need for services such as Medicaid is rising as people lose income and jobs. Before passage of the economic stimulus package, state deficits were projected to equal $350 billion over the next 30 months. Because nearly all states are required to balance their budgets, states have begun to cut … -
Video: NBC Nightly News interviews Nick Johnson on State Budget Problems and the California Budget Crisis
February 17, 2009
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Recovery Act Provides Much-Needed, Targeted Medicaid Assistance To States
February 13, 2009
The American Recovery and Reinvestment Act includes an $87 billion temporary increase in the share of Medicaid that the federal government would pay over nine calendar quarters (October 1, 2008, through December 31, 2010). It would provide three elements of Medicaid fiscal relief assistance to states, as outlined below.… -
Testimony: Sharon Parrott at the Hearing "Building a Foundation for Families: Fighting Hunger, Investing in Children" before the House Budget Committee
February 12, 2009
Thank you for the opportunity to speak with you today about the current recession, its impacts on poverty and families, and the recovery package. The current recession already has pushed up the unemployment rate from 4.9 percent in December 2007 to 7.6 percent in January 2008. Alternative measures of the labor market paint a bleaker picture.… -
Most States Are Cutting Education
Updated February 10, 2009
Note: Please see Most States are Imposing Cuts that Hurt Vulnerable Residents for updated information about education cuts in state budgets. Thirty-six states have cut education or proposed such cuts because they face massive, devastating budget deficits in this recession. The combination of rising unemployment, declining consumer … -
Senate's Cuts to "Fiscal Stabilization Fund" Weaken Stimulus Value of the Economic Recovery Bill
February 10, 2009
Overview and Summary The House economic recovery bill includes a $79-billion “State Fiscal Stabilization Fund” to help state and local governments fund education and other key services. However, the Senate — as a result of the Collins-Nelson amendment — has reduced the amount of funding to $39 billion and … -
Current and Projected State Deficits
Revised February 4, 2009
The three main organizations that track state fiscal conditions — the National Conference of State Legislatures, the National Association of State Budget Officers and the Center on Budget and Policy Priorities — have found large and growing shortfalls in the vast majority of states. There may be some confusion, however, … -
Preliminary Analysis of Medicaid Assistance for States In the Senate Economic Recovery Package
Updated January 30, 2009
This analysis is being updated in accordance with the legislative process and will be reposted here shortly. -
Senate’s Medicaid Assistance For States Less Targeted Than In House Recovery Bill
Updated January 30, 2009
The economic recovery package passed by the House of Representatives includes an approximately $88 billion temporary increase in the share of the Medicaid program paid by the federal government over nine calendar quarters (October 1, 2008 through December 31, 2010).[1] The states urgently need this type of assistance; states on their own are not able to provide critically needed … -
Senate’s Medicaid Assistance For States Less Targeted Than In House Recovery Bill
January 22, 2009
The Senate’s emerging economic recovery package includes an $87 billion temporary increase in the share of Medicaid that the federal government would pay over nine calendar quarters (October 1, 2008 through December 31, 2010). Like a comparable provision in the House-passed recovery package, the Senate proposal would provide three elements of Medicaid fiscal relief assistance … -
Most Large North Carolina Manufacturers Are Already Subject To "Combined Reporting" In Other States
January 15, 2009
For the past seven years, there has been serious discussion in North Carolina of adopting an important reform in the state corporate income tax known as mandatory “combined reporting.” Some North Carolina businesses and their lobbying organizations have opposed this change, claiming that it would result in some companies … -
Budget Cuts or Tax Increases at the State Level
Updated January 12, 2009
The recession is making it difficult for states to maintain balanced budgets, as nearly all of them are required to do by law. Roughly two-thirds of the states have already reduced spending and/or raised revenue to bring their budgets for the current fiscal year into balance, and additional states have indicated they will need to do so to maintain budgetary … -
Converting State Fiscal Relief to Loans Would Render It Ineffective As Stimulus
January 7, 2009
Senate Minority Leader Mitch McConnell’s recent suggestion that the federal government give states loans, not grants, for fiscal relief would make the recovery package considerably less effective in stabilizing the economy and preventing the recession from becoming deeper and more prolonged.… -
Policy Basics: Property Tax Caps
December 18, 2008
The property tax is a major source of funding for public safety, schools, roads, libraries, and other services in most American communities. In recent decades, concern over rising property tax bills has led a number of states to impose some form of limit on the amount of property tax revenue that … -
Policy Basics: Taxpayer Bill of Rights (TABOR)
December 18, 2008
In 1992, Colorado enacted a Taxpayers Bill of Rights (TABOR), a constitutional amendment that limits the annual growth in state revenues and expenditures to the sum of the inflation rate and the percentage change in the state’s population. (For example, if the general inflation rate is … -
State Revenues Plummet
Updated November 12, 2008
Newly available data compiled by the Rockefeller Institute of Government show conclusively that state revenue dropped sharply in the July-September 2008 quarter, creating large, additional state budget shortfalls.[1] All indications are that revenue collections will worsen further in coming months. Of the 42 states for which … -
Video: Iris Lav, Deputy Director, on State Tax Revenues, NBC Nightly News
November 9, 2008
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The Impact of State Income Taxes on Low-Income Families in 2007
October 29, 2008
Poor families in many states faced substantial state income tax liability for the 2007 tax year. In 18 of the 42 states that levy income taxes, two-parent families of four with incomes below the federal poverty line were liable for income tax. In 15 states, poor single-parent families of three paid income tax in 2007. And 26 … -
Press Release: Many States Tax Working-Poor Families Deeper Into Poverty
October 29, 2008
Poor families faced income tax bills that pushed them deeper into poverty last year in nearly half of the states with an income tax, according to a new report from the Center on Budget and Policy Priorities. Income tax bills on poor families in those 18 states range from a few dollars to several … -
Video: Testimony of Iris J. Lav on "Economic Recovery: Options and Challenges"
October 20, 2008
Hearing Titled: “Economic Recovery: Options and Challenges” There are 29 states that closed shortfalls of $48 billion in enacting their fiscal year 2009 budgets (for the year beginning July 1, 2008 in most states). The shortfalls equaled 9 percent of these states’ general fund (operating) budgets. Since fiscal year 2009 budgets … -
Video: Nicholas Johnson, Director of the Center's State Fiscal Project, speaks about state budget problems, and answers questions from call-ins on C-SPAN's Washington Journal Program
October 18, 2008
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States Face Two Immediate Financial Issues: Short-Term Borrowing and Big Budget Deficits
Updated October 10, 2008
States face two distinct financial problems right now. First, California and Massachusetts officials last week raised concerns about their states’ ability to access credit markets for short-term borrowing. Second, most states have been facing budget deficits that have forced, or … -
State Earned Income Tax Credits: 2008 Legislative Update
Updated October 8, 2008
Twenty-four states (counting the District of Columbia) have enacted an Earned Income Tax Credit (EITC), a tax reduction and a wage supplement for low- and moderate-income working families. State EITCs are based on the federal EITC, which a large body of evidence has shown to serve a number of important public policy goals. States … -
Video: Nicholas Johnson, Director of the Center's State Fiscal Project, speaks about state budget on CNN's Lou Dobbs
October 3, 2008
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House Stimulus Plan Effectively Targets Fiscal Relief to States
September 26, 2008
The House Leadership’s new stimulus proposal includes more than $14 billion in fiscal relief for states. This is designed to help states avert budget cuts and tax increases that they otherwise will have to institute to balance their budgets but that will make the economic downturn worse by withdrawing demand from the … -
Key Components of House and Senate Economic Recovery Packages Would Boost the Economy and Provide Needed Relief to Struggling Families
September 26, 2008
Congress is properly focused on designing an appropriate measure to address very serious problems in the financial markets, which many experts persuasively argue is essential to help avert a meltdown in the financial markets and a potentially severe recession. The problems in the financial sector, however, are not the only ones the … -
North Dakota's Measure 2 is Imbalanced and Would Harm Efforts to Secures State's Economic Future
September 18, 2008
North Dakota’s proposed Measure 2, a major change to the state’s income tax that will appear on the November ballot, would be detrimental to the state for three principal reasons: Measure 2 is risky and short-sighted. Measure 2 would cost the state a very large amount of revenue — some $400 million per … -
Press Release: “Measure 2” Would Set up North Dakota for Future Bust, Not Long-Term Growth
September 18, 2008
A ballot measure to cut taxes that North Dakota voters will consider this November could create major budget problems and hamper investments needed for long-term economic growth, according to a new report by the Center on Budget and Policy Priorities, a nonpartisan policy research organization based in Washington, DC. The measure is among the most radical such … -
Bonus Depreciation Tax Cut Unlikely To Provide Effective Economic Stimulus
September 10, 2008
Stimulus legislation enacted in February included a provision that increased the tax deduction which businesses can claim when they purchase certain types of equipment and place it in service during the 2008 tax year. Suggestions are being made that this “bonus depreciation” provision — a form of accelerated … -
Caution: the Tax Foundation's State and Local Tax Rankings are Unreliable
Revised August 13, 2008
As it has annually for several years, the Tax Foundation has attempted to measure the current impact of state and local taxation on the residents of each of the 50 states. And once again, the results are very different from the Tax Foundation’s own previous attempts to do this calculation. The Tax Foundations figures — both the … -
States Can Opt Out of the Costly and Ineffective "Domestic Production Deduction" Corporate Tax Break
July 29, 2008
States are losing hundreds of millions of dollars to a relatively new and rapidly growing corporate tax break that in most states never even received a vote in the state legislature. The federal government created this tax break, known as the “domestic production deduction,” in 2004. Since most states base … -
Proponents' Case for a Federally-Imposed Business Activity Tax Nexus Threshold Has Little Merit
June 26, 2008
A bill under consideration in both houses of Congress would take away from the states authority they currently have to tax a fair share of the profits of many corporations that are based out-of-state but do business within their borders. The House version of the “Business Activity Tax Simplification Act,” … -
Proposed “Business Activity Tax Nexus” Legislation Would Seriously Undermine State Taxes on Corporate Profits and Harm the Economy
June 24, 2008
A bill under consideration in both houses of Congress would take away from the states authority they currently have to tax a fair share of the profits of many corporations that are based out-of-state but do business within their borders. The Senate version of the “Business Activity Tax Simplification Act” … -
Property Tax Limitation in the Senate Housing Bill is Unnecessary, Impractical, and Likely to Cause Harm
June 23, 2008
Legislation that the Senate is considering in response to the ongoing foreclosure crisis (H.R. 3221) includes a provision that would allow non-itemizers to deduct property taxes up to an amount of $500 for an individual and $1,000 for a couple.[1] It would deny the deduction, however, to residents of any locality that raises its … -
Suozzi's Statement Ignores Truth About Massachusetts' Property Tax Cap
May 28, 2008
On May 21, the Center on Budget and Policy Priorities released a report, “Hidden Consequences: Lessons from Massachusetts for States Considering a Property Tax Cap.” The same day, Thomas Suozzi, the Chairman of New York’s Property Tax Relief Commission, issued a … -
Hidden Consequences: Lessons From Massachusetts for States Considering a Property Tax Cap
May 21, 2008
Executive Summary In 1980 Massachusetts voters approved Proposition 2 ½, which mandates that property tax revenues not exceed 2.5 percent of a community’s assessed value and that a community’s property tax revenue not grow by more than 2.5 percent a year. (See box below) Over the two and a half decades … -
Press Release: New York Shouldn't Look to Massachusetts as a Model for Property Tax Reform, Report Shows
May 21, 2008
With New York’s Commission on Property Tax Relief planning to recommend that the state impose a rigid cap on property taxes for education based on Massachusetts’ Proposition 2 ½, a new report from the Washington, D.C.-based Center on Budget and Policy Priorities describes the problems the law has … -
Eliminating Louisiana's Income Tax Will Harm the State's Budget Outlook, Competitiveness
Revised May 12, 2008
On April 29, the Louisiana Senate voted to phase out the state’s income tax over 10 years without proposing any replacement revenues. The House Ways and Means Committee is expected to consider this proposal, along with others that would significantly cut the income tax but not eliminate it, on Monday May 12. The desire to cut … -
How Much Would a State Earned Income Tax Credit Cost in 2009?
May 5, 2008
Twenty-three states have enacted tax credits for low- and moderate-income working families based on the federal Earned Income Tax Credit. A number of additional states are considering enacting EITCs in the 2008 legislative session. The following provides guidelines that policymakers and others can use to estimate … -
Video: CNN Features Elizabeth McNichol on Rising Income Inequality
April 23, 2008
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Fixing TABOR's "Ratchet" Will Not Repair TABOR
April 10, 2008
Proponents of adopting a tight TABOR limit in Florida sometimes claim that Florida would not experience the same negative effects on the economy and public services that occurred in Colorado. They argue that Colorado’s problems stemmed entirely from one feature of its TABOR, the so-called “ratchet.” (The ratchet, … -
State Fact Sheets: Income Inequality Over the Past Two Decades
April 9, 2008
Income Inequality Within the States: Ratio: Incomes of Top Fifth of Families Compared to Incomes of Bottom Fifth of Families State-specific fact sheets containing information on income inequality over the past two decades, including the changes in average incomes and income ratios, are provided through the links below. … -
Pulling Apart: A State-by-State Analysis of Income Trends
April 9, 2008
I. Executive Summary A state-by-state examination of trends in income inequality over the past two business cycles finds that inequality has grown in most parts of the country since the late 1980s. The incomes of the country’s highest-income families have climbed substantially, while middle- and lower-income families have …
