The Tax Policy Blog

February 04, 2009

Many states are going through budget shortfalls this year due to the economic downturn. Different states have reacted in a variety of ways to balance their budgets, including lobbying for federal bailouts, proposing tax increases, and calling for hiring freezes. In this edition of the Tax Policy Podcast, Tax Foundation Tax Counsel and Director of State Projects Joseph Henchman discusses the opportunity for tax reform in many states amidst these...

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February 04, 2009

(NOTE: this blog post has been updated to reflect changes to the Senate bill regarding the First-Time Homebuyer Credit)

The House passed the “American Recovery and Reinvestment Tax Act of 2009” last week, and the Senate is currently working out the details for its own version of the stimulus. As far as income taxes are concerned, the two bills contain several similar provisions, though they differ somewhat in the details of some of those...

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February 04, 2009

So the United States Senate has added to the massive stimulus bill a $15,000 tax credit for home purchases and for car buyers, two breaks: a deduction for the sales tax on car purchases and a deduction for car interest paid.

Of course all of these are tied up in a stimulus bill where principles are basically thrown out the window. (Politicians will justify just about any spending or tax break under the guise of "stimulating the economy.")

But what happens when the economy...

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February 03, 2009

Yes, 96 years ago, the 36th state (New Mexico) ratified the Sixteenth Amendment and it became part of the U.S. Constitution. Later that month, February 1913, U.S. Secretary of State Philander C. Knox (pictured right) proclaimed that the Sixteenth Amendment to the U.S. Constitution had been ratified. In the fall, Congress passed the first income...

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February 03, 2009

As you may have heard, a few nominees to positions in the Obama administration have had some tax troubles.

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February 03, 2009

Okay, so the IRS isn't the devil, but for taxpayers it can be devilishly difficult to figure out your taxes, not to mention paying them, when economic misfortune strikes.

So the IRS has put together a sympathetic Q&A for the economic downturn. Under "Job Related," you'll find answers to questions like: What...

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February 03, 2009

Tax Foundation President Scott Hodge appeared with Republican strategist Karen Hanretty on Fox News's Your World with Neil Cavuto last night (Monday, February 2, 2009) to talk about recent news involving Health and Human Services Secretary-Designate Tom Daschle's failure to report consulting income and non-monetary benefits he received from his former business partner. Scott takes the...

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February 02, 2009

More than anyone else, Senators Baucus and Grassley, the Chairman and ranking member of the Senate Finance Committee, have led the effort to reduce the size of the tax gap.  Just two years ago they grilled then Treasury Secretary Paulson on the issue in front of the Senate Finance Committee.  They also held up the confirmation of...

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February 02, 2009

Gov. Arnold Schwarzenegger's "nickel a drink" liquor tax increase proposal (which is a hefty increase; the tax on wine would go from 4 cents to 29.6 cents), has some worried:

A proposal to raise the state tax on wine to a level more than six times higher to help close California's giant budget deficit...

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February 02, 2009

On Friday, Mayor Mike Bloomberg's administration released a preliminary...

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January 31, 2009

Joe Biden's new task force on Issues of the Middle Class will be considering ways to improve living standards for Americans.  It might be worth pointing them in one direction that they might otherwise overlook:  There is considerable evidence that reductions in the tax on capital income can have a pronounced positive effect on living standards.

The U.S. tax system taxes capital income in a number of different ways.  Capital income can be subject to the corporate tax, investor level...

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January 30, 2009

So news broke today from the Washington Post that former D.C. mayor Marion Barry is yet again in trouble with the IRS. That doesn't surprise us. But that got us thinking that it is a rather amusing state of affairs in tax policy right now. The current chairman of the Ways and Means Committee (the committee responsible for writing tax law), Charlie Rangel, has tax problems. And as we all know, Obama's Treasury Secretary, Timothy Geithner, whose department oversees the IRS, has tax issues....

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January 30, 2009

In a piece on New York City's income tax revenues, CNN notes:

While city incomes taxes are common in Iowa, Indiana, Maryland, Michigan, Ohio and Pennsylvania, they are an anomaly in most parts of the country, according to a 2008 report by Tax Foundation, a Washington-based think tank. New York City and Yonkers are the only cities levying...

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January 29, 2009

We have updated our State Sales, Gasoline, Cigarette, and Alcohol Tax Rates table for 2009. Some notable changes during 2008:

  • Alaska's gasoline excise tax of 8 cents per gallon is suspended from September 2008 through August 2009. Alaska Governor Sarah Palin and the Alaska Legislature enacted the gas tax holiday last summer when oil prices reached record highs.
  • Indiana and Iowa each increased their sales...
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January 29, 2009

This is the time of year when governors present to their constituents their visions for the coming year, sometimes full of detailed plans and other times mostly empty rhetoric.  Tax policy, of course, is one of the main topics covered.

For anyone who missed his or her governor's address or wants to know what other states' governors have proposed, Stateline.org is a useful resource. This page contains...

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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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