This week, special sessions with major tax implications are in the air in Kansas, Nebraska, and West Virginia as additional pushes are made to move tax changes over the finish line. A special session in Virginia is set to kick-off this coming Monday. A major court case was argued in California regarding the fate of a ballot initiative that would seriously undermine state and local authority to raise taxes or fees by requiring a two-thirds vote on any change. The measure could further complicate tax collections by being applied retroactively. Meanwhile, tax cuts have advanced in Colorado and Pe ..read more

Bloomberg Tax originally published this piece here. Shifts from graduated to single-rate income taxes are designed to benefit higher earners. Different families will still pay different rates, but the rich will pay less. The shift in Iowa is no different. As Iowa lawmakers change the state’s graduated personal income tax to a single flat rate, they are designing a state tax code where the rich will pay a lower rate overall than families with modest means. Flat income taxes are a problem anywhere, but the Iowa details are particularly concerning. The state will accelerate and dee ..read more

This week, many states took steps toward enacting tax cuts. Some of which would do more to benefit high-income families. Others stopped regressive tax cuts or moved the needle on refundable credits for low- and middle-families. Kansas Gov. Laura Kelly vetoed the legislature’s most recent tax cut plan, which marks the third time the legislature has failed to override a veto over the past two years. Meanwhile, Iowa enacted legislation that deepens and accelerates its currently scheduled, regressive tax cuts. And the Hawai’i legislature unveiled a major state income tax cut that would result in ..read more

Read as PDF The Institute on Taxation and Economic Policy is writing to express its support for proposed IRS REG-123376-22. We strongly support recommendations made by the Treasury Advisory Committee on Racial Equity to expand the amount of tax data disclosed to the Census Bureau by the IRS.  Increased information transfer from the IRS would improve the quality of data at the Census Bureau and expand opportunities for tax policy research. This is critical for researchers who rely on Census Bureau data and products to fill the informational gaps present in tax data.  Among other thing ..read more

Property taxes are the backbone of local governments, generating approximately three in four local tax dollars nationwide. They are essential for funding schools, transit, parks, libraries, health departments, and other public services. Property taxes have historically been regarded as a relatively stable and broad-based funding source, but flawed tax administration practices, state constraints, and certain policy decisions contribute to their regressivity. This inequity gives rise to distinct racial disparities. It doesn’t have to be this way: proven policy solutions like property tax circuit ..read more

As many state legislative sessions are wrapping up, lawmakers are taking steps to: deepen, accelerate, and attempt to memorialize existing tax income tax cuts (in Iowa); veto expensive, top-heavy tax cuts (in Kansas); punt conversations on property tax cuts and pay-fors to special session (in Nebraska); and weigh various options for revenue raising (in Vermont). Meanwhile, in his recent budget proposal, North Carolina’s Gov. Roy Cooper calls for fewer giveaways for corporations and the wealthy by pushing back against taxpayer-funded private school vouchers and proposing to keep the state’s cor ..read more

This op-ed originally appeared in MSNBC Tax preparation behemoth Intuit (maker of TurboTax) recently unveiled a new campaign branding itself as a feminist company. “When it comes to the complexities of the tax code, women encounter distinct challenges,” reads a post on the company’s official blog, “and here at Intuit, we’re committed to empowering prosperity for every single person—especially the inspiring women who play an integral role in driving our collective success.” The campaign is reminiscent of the old Virginia Slims ads, hawking sexy-seeming cigarettes to women under the sl ..read more

Earlier this year, the Institute on Taxation and Economic Policy (ITEP) published the seventh edition of our flagship report, Who Pays? A Distributional Analysis of the Tax Systems in all 50 States. The study is a comprehensive overview of state and local taxes and makes a case for why it’s time to rethink tax policy in most states. Nearly every state (41 of 50) taxes the top one percent of taxpayers at lower rates than working- or middle- class families. In large part this is because many states rely heavily on regressive sales and excise taxes without sufficiently strong graduated personal i ..read more

Taxes paid to local governments support the building blocks of thriving families and communities. Public investments in education, parks, public health, and much more, facilitated by local tax dollars, change lives for the better. Three leading localities are also using their tax systems to invest directly in workers and families with local refundable credits modeled after the Earned Income Tax Credit, as we detailed in a recent report. This tax season more than 800,000 households in New York City, Maryland’s Montgomery County, and San Francisco are set to receive a boost through local refunda ..read more

This week tax cuts were debated across the upper Midwest. Nebraska finally put to bed plans for a regressive swap of sales tax revenue for property tax cuts, sparing the state’s working families a net tax increase. Wisconsin Gov. Tony Evers vetoed yet another income tax cut passed by the GOP controlled legislature. And Idaho Gov. Brad Little signed a cut into law, dropping the state’s income tax rates from 5.8 to 5.695 percent. Meanwhile in the South, Virginia Gov. Glenn Youngkin vetoed legalizing recreational cannabis sales, which would have included an 8 percent excise tax, and Georgia Gov ..read more