Senior Director of State Fiscal Research
As we’ve said, many states expect to see a change in revenues under the federal tax law. But states should respond very cautiously to the possibility of a revenue boost and focus their response on preparing for potential cuts in federal funding for states, as well as the next recession, as our new report suggests.
They also should strongly consider raising revenue from corporations and other wealthy interests receiving a large tax break under the new law in order to invest in stronger education systems, more efficient transportation networks, and other public services that undergird broadly shared prosperity.
In response to the federal tax changes, states should: