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More Evidence That State Tax Breaks Won’t Save Jobs

September 17, 2013

Intel Corporation, the world’s largest maker of computer microprocessors, announced on Friday that it was eliminating 400 jobs at a New Mexico plant, just six months after pushing successfully for large corporate tax cuts there.  It’s just the latest example of why it’s not smart to...

State Legislators’ Task Force Gets It Right on Taxation of Online Hotel Bookings

August 19, 2013

For many years, online travel companies (OTCs) like Expedia and Priceline have avoided paying the appropriate amount of state and local sales and lodging taxes on hotel rooms they book.  The companies calculate tax only on the wholesale room rate they pay the hotels, not the higher retail room rate they charge consumers.  Now, a National Conference of State Legislatures’ (NCSL) committee...

Despite Claims, Studies Don’t Agree That State Tax Cuts Boost Growth

June 17, 2013

In recent testimony to the North Carolina legislature supporting tax cuts, the Tax Foundation asserted that “rarely does empirical economic literature speak so strongly in unison as it does about the effect of taxes on economic growth.”  But that assertion is simply false, at least with respect to the literature on the effect of state and local taxes on state economic growth...

New York High Court Upholds the State’s “Amazon Law”

March 29, 2013

Earlier this week, I applauded a recent “test” vote in the U.S. Senate that signaled overwhelming and bipartisan support for pending legislation that would require large Internet merchants to collect...

Senate Calls for Level Playing Field for Main Street Retailers

March 25, 2013

The Senate signaled support for requiring large Internet merchants to collect state and local sales taxes, just like Main Street retailers must do, voting overwhelmingly in its budget resolution to “allow states to enforce state and local use tax laws.”

Allowing states to do so would not impose new taxes.  State and local sales taxes are already due on any items a consumer buys...

Want to Help Small Businesses? First, Do No Harm

February 19, 2013

Lawmakers are seriously considering cutting or even repealing the personal income tax in at least ten states:  Indiana, Kansas, Louisiana, Missouri, Nebraska, North Carolina, Ohio, Oklahoma, South Carolina, and Wisconsin.  One of the most common arguments for these tax cuts is that they’d encourage small businesses to grow and create jobs, since most small firms pay taxes on their profits...

Remaining States Should Opt Out of Costly Corporate Tax Break

January 31, 2013

I listed four reasons recently why states shouldn’t cut their corporate income taxes.  In a new paper, I describe a tax change that they should make:  cancel a corporate tax break that costs them hundreds of millions...

4 Reasons Why States Shouldn’t Cut Corporate Income Taxes

January 25, 2013

As my colleague Elizabeth McNichol explained last week, policymakers in Louisiana, Nebraska, and North Carolina have proposed eliminating their states’ income tax and raising the sales tax to make up the lost revenue.  Those plans won’t produce fairer tax systems or more “...

Taxing Digital Downloads: A Few Coins for State and Local Coffers

December 17, 2012

Lots of states and localities that are struggling to pay for public services won’t collect any revenue from this year’s many holiday-related sales of digital goods and services — movies, books, games, software, and so on.  Although every state with a sales tax levies it on these products when they’re sold in physical form in stores, about half of them haven’t updated their laws to tax these...

Nike, Oregon, and the Race to the Bottom

December 14, 2012

Less than two weeks after an exhaustive New York Times series showed how corporations play states off against each other for tax breaks, Nike has fired the starting gun on an even faster race to the bottom.  As the price of expanding in Oregon, where it is...