The Tax Policy Blog

July 14, 2015

Yesterday we wrote about a proposal from Representative Tom Rice (R-SC) that would raise the gas tax by 10 cents and adjust it for inflation going forward in order to close Highway Trust Fund’s ongoing deficits. The plan would also not raise taxes on net by offering a $133 per-person income tax credit. Although it is a reasonable way to fix the Trust Fund’s shortfall, it faces political difficulties....

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July 14, 2015

Last year, the Tax Foundation published a primer on the Marketplace Fairness Act (MFA). In the year since, there have been new MFA-related bills introduced in Congress and more litigation over states’ nexus laws, but the status quo remains unchanged. In light of Prime Day tomorrow, here is an update on MFA.

Designed to allow states to overcome...

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July 13, 2015

If you live in Chicago and stream movies and TV on Netflix, expect your Netflix bill to be 81 cents higher beginning this fall. In June, the Chicago Department of Finance issued two rulings which extend two existing taxes to the subscription costs of streaming and cloud-based services. The Amusement Tax was extended to include amusements that are...

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July 13, 2015

At the end of this month, the Highway Trust Fund, the mechanism by which the federal government provides states and localities with transportation funding, will run out of money. If this happens the trust fund will no longer be able to cover its obligations. With the trust fund facing a cumulative $168 billion shortfall over the next 10 years, lawmakers are looking for ways to keep the trust fund from going broke.

Last week, Representative Tom Rice (R-SC)...

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July 09, 2015

This week, the Senate Finance Committee’s International Tax Reform Working Group released their final report. Over the last few months, this bipartisan working group has been analyzing different aspects of international tax reform while taking comment from the public. The International Tax Reform group was tasked with finding a bipartisan framework for reforming the taxation and regulation of overseas income, especially the income of multinational corporations. The co-chairs of this working...

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July 09, 2015

Multinational corporations, intergovernmental organizations, and academics know that high levels of corporate taxation serve as a disincentive for foreign direct investment (FDI). Companies shift resources toward countries that provide the most...

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July 09, 2015

As oil prices slump for the past year, the United Arab Emirates is setting up a federal tax system to help boost government revenue. The federation of seven emirates is considering corporate tax and value-added tax.

At the federal level there is no corporate income tax. There’s also no personal income tax or value-added tax. Emirate-level personal income...

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July 08, 2015

The United Kingdom has announced that it will lower its corporate tax rate to 18 percent over the next five years, which will give the UK the lowest corporate tax rate among the G20 countries.

George Osbourne, the UK’s Chancellor of the Exchequer, made the announcement as part of his first budget proposal since the...

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July 08, 2015

This week’s map shows the real value of $100 in each state. Prices for the same goods are often much cheaper in states like Missouri or Ohio than they are in states like New York or California. As a result, the same amount of cash can buy you comparatively more in a low-price state than in a high-price state.

The Bureau of Economic Analysis has been measuring this phenomenon for two years now; it recently ...

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July 07, 2015

Last week, Republican presidential candidate Jeb Bush released 33 years of tax returns. He reported a little more than $7.2 million in AGI and $2.9 million in taxes paid on his 2013 and most recent tax return. His effective tax rate (income plus payroll) was approximately 36.5 percent.

As expected, the news media reported on his tax returns. Interestingly, some articles have taken the angle that Jeb Bush isn’t paying...

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July 07, 2015

Does your state have its fiscal affairs in order? It’s not an easy question to answer, in part because the question can mean so many different things, including:

  • Can the state pay its current bills? (cash solvency)
  • Will annual revenues be sufficient to cover budgeted expenditures? (budget solvency)
  • Are the state’s long-term liabilities—think bonds and loans—sustainable? (long-run solvency)
  • How much room is there to raise additional revenue should...
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July 06, 2015

There have been several big legislative changes and proposals from D.C’s lawmakers over the past week. On June 30th, Washington D.C’s legislative council voted to allow several tax cuts to take effect in September ahead of schedule and authorized an emergency measure to deter synthetic drug use. Additionally, Mayor Muriel Bowser’s 2016 budget now...

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July 06, 2015

With the clock ticking, Governor Jay Inslee (D) called the Washington State Legislature into its third and final special session on June 28th to determine the budget for the next biennium. The budget includes many important changes in the state tax code.

Although the Office of Financial Management projected revenue growth in the absence of any tax increase, new education funding mandates and the Governor’s legislative...

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July 02, 2015

Michigan has been tangled up in a transportation funding back-and-forth for the last year or so. The most recent episode was a May ballot initiative to raise sales and gas taxes that failed 80-20. As of yesterday, news sources report that legislators in the House and Senate have come back with new funding plans. The...

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July 02, 2015

Compared to taxes on alcoholic beverages such as wine and beer, distilled spirits are taxed at much higher rates across the states, ostensibly to adjust for higher alcohol content. Today’s map shows how spirit excise taxes in your state compare.

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