Tax Analysts Blog

Wednesday, April 1, 2015
Modern state tax policy has been dominated by cravenness and cronyism. But every once in a while, politicians muster the courage to do the right thing. Several proposals have been advancing in legislatures that will bring more transparency to state fiscal systems. I cannot overstate the importance...
Wednesday, March 25, 2015
Recently, the Louisiana Tax Study Group released its report recommending changes to almost all the state's taxes. The study, commissioned by the Legislature, was performed by three academics, Jim Richardson of Louisiana State University and Steven Sheffrin and James Alm of Tulane University. Those...
Wednesday, March 18, 2015
Louisiana Gov. Bobby Jindal (R) has a tax plan that should be creating buzz all around the country. He wants to convert some of the state's individual and business tax credits from refundable to nonrefundable. Let's be clear: Refundable tax credits are government transfers. They are welfare. They m...
Wednesday, March 11, 2015
I have been writing about local option sales taxes for 20 years. The issues haven't changed much. To varying degrees, local sales taxes apply in 38 states. They are imposed in thousands of jurisdictions. Kentucky is an exception. Its local governments cannot impose a sales tax. But there are folks...
Wednesday, March 4, 2015
In a microcosm of all that is wrong with state tax policy, Michigan Gov. Rick Snyder (R) wants to renegotiate the tax incentive agreements his state has with 240 companies. It turns out the state owes about $9.4 billion in tax credits to companies that created jobs in Michigan. That liability costs...
Wednesday, February 25, 2015
North Dakota Sen. George Sinner (D) is sponsoring a bill (SB 2223) before the legislature that would eliminate the sales tax on all clothing purchases. Sinner no doubt means well, but this is an awful idea. The senator is motivated by the fact that the sales tax is regressive and that exempting nec...
Wednesday, February 18, 2015
From the start, I have believed that Quill should be overturned, either by the Supreme Court or by Congress. Requiring remote sellers to collect and remit sales tax imposes no burdens on interstate commerce. But the proposal from Rep. Bob Goodlatte, R-Va., to adopt an origin-based collection system...
Wednesday, February 11, 2015
Maine Gov. Paul LePage (R) recently riled folks up by proposing to end property tax exemptions for some nonprofit organizations in the state. Organizations with assets of more than $500,000 would lose their exempt status. LePage's proposal is part of a bigger plan that would greatly reduce state ai...
Wednesday, February 4, 2015
Last November, Nevadans went to the polls and wrecked a proposal to adopt a margin tax. Voters rejected the idea of creating a new tax, 3 to 1. The proposal was opposed by Gov. Brian Sandoval (R), and rightfully so. The margin tax was basically a gross receipts tax imposed without regard to profita...
Wednesday, January 28, 2015
The Institute on Taxation and Economic Policy (ITEP) released its annual "Who Pays" report. The report should be read by everyone in the state and local tax policy business. Once again, ITEP has found that state and local tax systems are decidedly regressive. In fact, ITEP concluded that the effect...
Wednesday, January 21, 2015
I am going to periodically call out bad tax policy ideas as they are introduced in the states. Here are three: 1. Legislators in Nebraska would like to cut property taxes and allow local governments to impose a local option income tax to replace the revenue. This is a terrible idea. Although citize...
Wednesday, January 14, 2015
The Michigan Legislature passed a bill that would significantly increase the state's earned income tax credit. Some 800,000 Michigan families will see tax relief. I think that is a good thing. But the change won't go into effect unless voters approve a sales tax increase from 6 percent to 7 percent...
Wednesday, January 7, 2015
Washington Gov. Jay Inslee recently released his proposed budget. It illustrates a lot of what is wrong with tax policy in the states. The governor wants to raise taxes by $1.4 billion over the next two years. Conservatives may think this is terrible -- and it is. But the problem is how Inslee want...
Wednesday, December 10, 2014
Mississippi Gov. Phil Bryant (R) recently proposed a plan to create a 15 percent nonrefundable earned income tax credit for low-income working families. I have not always been a fan of the EITC, mainly because I find it odd to have the tax collector run what is essentially a welfare program. But EI...
Wednesday, December 3, 2014
Republicans now control 69 of the 99 legislative chambers in the states. It may be the greatest Republican dominance since Reconstruction. Democrats control both houses in only seven states. Republicans managed to capture 11 chambers in this past election, including several in decidedly blue states...
Wednesday, November 19, 2014
I admire Warren Buffett. I admire his genius. I admire his ability to create wealth. But the recent elections show that Americans do not want to listen to billionaires advocating for higher taxes. You may recall Buffett and President Obama saying that no person should pay taxes at a rate lower than...
Wednesday, November 12, 2014
As far as state tax policy is concerned, some things seem obvious from last week's elections. First, state governments became more conservative. Republicans won the governorships in Massachusetts, Illinois, and Maryland -- the bluest of blue states. And except in Pennsylvania, the GOP defended all...
Wednesday, November 5, 2014
American political leaders can learn something from Hungary's ill-fated attempt to impose an Internet tax. The plan in Hungary was to tax Internet usage at the equivalent of about 62 cents a gigabyte. Why tax Internet usage? Apparently, having the world's highest VAT rate (27 percent) doesn't bring...
Wednesday, October 29, 2014
People who have studied tax incentives know everything that's wrong with them: They don't work (companies choose where to locate for other reasons); they're unfair (some companies get them, others don't, and their benefits inure to the haves rather than the have-nots); they're inefficient (governme...
Wednesday, October 22, 2014
States have several tax-related ballot questions slated for November. Here they are, along with my musings: Massachusetts voters will decide whether to repeal the state's inflation adjustment to its gasoline tax (Question 1). The adjustment causes the tax to go up every year. That could be a good t...