The Tax Policy Blog

May 27, 2008

This blog has long documented the pathetic (as measured by truthful substance) campaigns put forth by the National Association of Home Builders and the National Association of Realtors when it comes to federal tax policy. Now they are at work at the state government level. And where else would you expect a state to approve more bad tax policy than Michigan? This morning's Tax Analysts reports that both Republicans and Democrats are seeking to provide relief from the "pop-up tax" as...

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May 27, 2008

A reader wrote in after reading this post on the Kentucky v. Davis outcome, asking for more information about why states' practice of excluding municipal bond interest income is problematic. There are many reasons, of course, one of which is that the exclusion helps shield high-tax states from interstate competition that could bring down tax burdens. Our brief points to previous Tax Foundation research on the topic:

...
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May 27, 2008

Tomorrow, May 28, 2008, is the fifth anniversary of the second round of Bush tax cuts to personal income, known officially as the Jobs and Growth Tax Relief and Reconciliation Act of 2003 (JGTRRA).

Impatient with the economic stagnation that followed the enactment of the first Bush tax cut two years earlier, the Republican congress pushed JGTRRA through during the spring of 2003 to...

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May 27, 2008

While the housing market downturn has its downsides, one of the benefits is watching organizations like the National Association of Realtors try to talk out of both sides of its mouth. Here's what the organization said earlier this month regarding the need for the housing market to be given a boost by government (in other words, you the taxpayer):

A sound and dynamic...

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May 25, 2008

With Memorial Day approaching, it's a good time to think about the tax treatment of veterans. While criticizing any policy that expands benefits to those who serve in the military is not likely to be very popular on the surface, policymakers and the general public who truly believe that it is in our country's interest to compensate those who serve in the military need to realize that the tax code is not always the best vehicle for doing so.

The federal tax code is filled with many...

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May 23, 2008

There's a new chapter in the Chicago tax saga. As if the Chicago sales tax were not high enough already, now online buyers of tickets to city events might face an amusement tax as well. From the Chicago Tribune:

Buyers who purchase tickets to Chicago sporting and cultural events online through eBay and StubHub could end up paying an...

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May 21, 2008

On Monday the Tax Foundation filed friend-of-the-court brief with the North Carolina Supreme Court in Heatherly v. State, urging the court to reverse a lower court ruling and hold that the North Carolina Education Lottery generates tax revenue, not "profits."35 percent of lottery revenues is dedicated to general state spending, equivalent to a 35-percent tax on the sale of each lottery ticket. If that revenue is found to be a tax under the meaning of...

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May 21, 2008

We have pointed out the flaws of state-run lotteries many, many times: they impose taxes paid disproportionately by the poor; they're not transparent, or honestly labeled as taxes; the revenue is often not spent as promised; they impose an unfairly high implicit tax rate on one particular consumer good; and they unnecessarily increase the overall complexity of a state's tax system. There's also a question of whether running a gambling enterprise, as a monopoly business, is an...

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May 19, 2008

The U.S. Supreme Court this morning upheld 7-2 Kentucky's discriminatory practice of taxing interest on non-Kentucky bonds, but not Kentucky bonds, as constitutional. The Tax Foundation had submitted a brief urging that the law be found unconstitutional as violating the Commerce Clause and other provisions of the Constitution. The brief also highlighted Tax Foundation...

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May 17, 2008

Tax Prof Blog writes of the ignorance of the Denver Post and Colorado Senator Ken Salazar regarding the fact that adjusted gross income for a business is income LESS expenses.

Denver Post: Plowing Into the Farm Bill, by Anne C. Mulkern:

Sen. Ken Salazar, a Denver Democrat who supports the bill, disputed the idea...
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May 15, 2008

We received word yesterday that the South Dakota Supreme Court has declined to rehear the Metropolitan Life Ins. Co. v. Kinsman insurance tax discrimination case; the Tax Foundation had filed an amicus brief in support of the petition for rehearing. South Dakota is one of 8 remaining states that seek to protect their domestic insurance companies by imposing heavier taxes on out-of-state companies that do business in the state. The...

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May 14, 2008

From today's State Tax Notes:

Michigan Final SB 1189 Amends Eligibility Criteria for Credit Under MEGA Act

Michigan SB 1189, signed into law as Public Act 110, amends the Michigan Economic Growth Authority (MEGA) Act by reducing, from 100 to 50, the minimum number of new jobs that a business must create or the number of retained jobs that a business must maintain to qualify for a business tax...

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May 14, 2008

From this week's Economist:

ITEM 100237099149 was a bargain. Offered for sale on eBay on May 5th, it was a CD of the “income-tax returns for 2005 of the entire Italian people”. Until it was removed after a few hours, it could have been bought for around $75.

Five days earlier Italians had learnt, to their varying dismay...

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May 13, 2008

North Carolina Gov. Mike Easley wants to raise the pay of teachers in North Carolina and improve government-provided mental health programs in the state. So who should pay for that? The general public who would theoretically benefit from the higher quality teachers that higher salaries would bring into the state and would also benefit from the greater spending on mental health care?

Not a chance. Easley doesn...

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May 13, 2008

We mentioned a few days ago that your stimulus check could be less than you expect if you have unpaid alimony, child support, or back taxes. According to the Washington Post today, 449,531 federal employees and retirees may see a smaller stimulus check due to $3.58 billion in unpaid back taxes. Over 100,000 current federal employees (out of 171,...

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Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.

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