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State and Local Tax Systems Disproportionately Burden Lower-Income Families

January 30, 2013

We warned last week that a number of state proposals to swap their income taxes for sales taxes would be ill-advised.  Those proposals would only worsen tax systems that are already highly regressive, as a new report from the...

Big Cuts Already Baked In for Federal Grants to States and Localities

December 17, 2012

The new Fiscal Survey of States from the National Governors Association and National Association of State Budget Officers (NASBO) warns, correctly, that state finances are too weak to absorb big cuts in federal grants for education, health care, disaster preparedness, and other services that...

States’ “High-Stakes Bazaar” of Corporate Tax Breaks

December 4, 2012

An oft-overlooked source of many states’ and localities’ financial problems is their overuse of corporate tax subsidies to try to attract and keep businesses.  In a must-read three-part series, the New York Times connects the dots between lucrative tax breaks for corporations and the...

Voters Refuse to Tie Their Hands on State Revenues

November 8, 2012

Voters on Tuesday considered a host of ballot measures on tax and budget issues, but the most important from a long-term perspective may have been those in Florida, Michigan and New Hampshire.  All three states rejected major constitutional amendments that would have handcuffed their ability to...

The State and Local Drag on the Recovery

June 8, 2012

President Obama pointed out this morning that job losses among state and local governments are slowing the recovery.  The graph shows what he’s talking about:  states and localities have shed 662,000 jobs since employment in this area peaked in August 2008. ...

The Small Business Distortion

June 7, 2012

Here’s an important lesson for anyone watching state or federal tax policy debates:  just because elected officials say they’re doing something for “small businesses” and “job growth” doesn’t mean that they really are.

A good example comes from North Carolina, where the legislature last year passed a business tax break that is taking $336 million a year away from public schools, health...

Kansas’ Big and Damaging Tax Cut

May 22, 2012

Kansas Governor Sam Brownback is poised to sign what may be the most fiscally irresponsible and economically damaging piece of legislation to emerge from a state in many years.

The bill is estimated to cut more than $800 million — or 13 percent — per year from the state...

Claims for Oklahoma Tax Cut Not OK

May 17, 2012

Yesterday’s Wall Street Journal editorial supporting a proposal by Oklahoma governor Mary Fallin to phase out the state’s income tax contains a slew of incorrect or misleading statements.  For instance:

  • The editorial wrongly asserts that states without
  • ...

Tax Foundation’s State “Tax Freedom Days” No More Valid than the Federal Version

April 2, 2012

Today the Tax Foundation released its list of when “Tax Freedom Day” allegedly arrives in each state.  It’s a deeply flawed and misleading exercise for a host of reasons.

Each state’s Tax Freedom Day – just like the federal version -- sharply overstates middle-class tax levels.  As my colleagues...

Education Job Losses Finally Ending?

March 9, 2012

After several years of bad employment news in the education sector, today’s jobs report suggests that school districts are starting to hire again.  But, this good news for students, teachers, communities, and the economy comes with several caveats, as I explain below.

3-9-12sfp.jpgNew and newly...