The Tax Policy Blog

July 18, 2008

The Tax Foundation has updated its annual summary of the latest federal income tax data given that the IRS has released the percentile data early this year (July as opposed to September).

The basic story that comes from this newly available data for tax year 2006 is that the share of income (as measured by AGI) and the share of taxes paid by the top 1 percent of tax returns are once again at all-time highs.

In 2006, the top 1...

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July 17, 2008

It's been a big week for Dan Mitchell of the Cato Institute on our blog this week. First we covered a Flat Tax vs. FairTax debate he participated in at FreedomFest, and then another event where he discussed the McCain and Obama tax plans. To make it an even three for the week, we bring you one of Dan Mitchell's videos for our Thursday blog post.

Mitchell has made these videos for the...

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July 17, 2008

We're getting a good amount of interest in the issues surrounding New York's attempt to tax out-of-state sales and businesses with its "Amazon" tax, and impact that the Business Activity Tax Simplification Act (BATSA, H.R. 5267) would have on this and other state efforts. This morning's New York Sun has a lengthy piece on some of the issues as they affect New York...

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July 16, 2008

More economic ignorance when it comes to sales tax holidays:

Gov. Jim Douglas is praising Vermont's first two-day sales tax holiday and is hinting he'd support making it an annual event.

It will be months before the full impact of the sales tax holiday are known.

But Douglas says one retailer told him sales last weekend were 20 times what they were a year ago.

And Douglas says waiving the 6 percent tax has a ripple...

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July 16, 2008

Our recent report on local income and wage taxes notes that all 23 Maryland counties impose an income tax on residents, but does not break them out. Based on a few requests, we do so here.

A side note: Nonresidents are not subject to the county income tax, but must pay to the state an amount equivalent to the lowest county tax rate (currently 1.25% - Maryland residents should thank Worcester County for keeping this low!).

...

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July 16, 2008

According to a recent Bloomberg article, Speaker Pelosi has suggested another round of economic stimulus (no details reported). The first round of stimulus checks, according to some, was gobbled up by rising energy prices. In addition to rebates, another stimulus package may include additional...

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July 16, 2008

The Michigan Economic Growth Authority (MEGA) doles out tax credits and grants ostensibly to encourage out-of-state businesses to expand and relocate in Michigan. However, MEGA's seven-person board seems to believe virtually any relocation is worthy of a grant and a tax credit.

As one example,...

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July 15, 2008

Happy Tax Freedom Day to our freedom-loving friends in Israel. According to the non-profit Jerusalem Institute for Market Studies, July 15th marks the day in which Israeli citizens have finally worked to pay off all of their tax bills and can now begin to work to pay their own bills. Click here for the details.

In case you are trying to do the math, Israelis...

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July 15, 2008

We'd like to thank legislatures in Florida and Virginia for promoting sound tax policy by doing nothing at all.

  • In June, Virginia Governor Tim Kaine (D) called a special legislative session that was intended to raise $1.1 billion in new taxes for transportation. Richmond policymakers had lots of different ideas about how to do that, most of them...
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July 15, 2008

State Tax Review (subscription required) reports that the California Franchise Tax Board has issued rules for income tax filing by same-sex married couples.  As in other...

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July 15, 2008

California has the dubious distinction of being the only state with a double-digit individual income tax rate. A new Tax Foundation Fiscal Fact examines the state's changing tax rates over the years in light of the current debate in the legislature on whether to increase the top rate again. From Fiscal Fact No. 134, "California Legislators Push for More Double-Digit Income Tax Rates," by William Ahern:

...

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July 15, 2008

The Cato Institute hosted a policy forum today entitled McCain and Obama: Comparing Their Economic Platforms.  One of the three speakers, Dan Mitchell, summed the future of the American tax burden up quite nicely:

            No matter who wins, it's going to grow.

Mitchell also offered a fair comparison of the two distinct tax proposals.  Obama's plan, according to Mitchell, means "higher taxes on work...

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July 14, 2008

Beginning July 1, 2008, workers in Philadelphia will see a little bit more in their paychecks. That day marks the second reduction within a year in that city's wage tax imposed on both residential and nonresidential workers in Philadelphia, although it remains the highest in the nation.

The new rates are 3.98% for residents (down from 4.219% in early 2008 and 4.26% in 2007) and (precise to the ten-thousandth digit) 3.5392% for nonresidents (down from 3.7242% in early 2008...

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July 14, 2008

One of last week's FreedomFest 2008 events was a debate between proponents of the FairTax and the Flat Tax. Both are tax reform proposals that would replace much of our existing federal tax system. The FairTax is a national sales tax imposed on retail transactions, coupled with a "prebate" sent to each American each month. There are many Flat Tax proposals, but all aim to eliminate many of the deductions and credits in the tax code, and tax all income at one rate.

...

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July 14, 2008

Tax Watch is the Tax Foundation's quarterly tax policy newsletter, presenting our economic research and analysis in a simple, non-technical format-ideal for the non-economist looking for a clear explanation of current tax issues.

Highlights from the Summer 2008 issue include:

  • Sizing Up Obama's Social Security Tax Plan
  • Senate Testimony: Time to Clean Up the Tax Code
  • U.S. States Lead World in High Corporate Taxes
  • High Gas...
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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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