The Tax Policy Blog

July 02, 2014

For this week's tax map, we take a look at cigarette tax rates across the country, which vary widely from state to state and are levied on top of a federal rate of $1.0066 per 20-pack of cigarettes.

(Click on the map to enlarge it. ...

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July 01, 2014

With Independence Day around the corner, millions of Americans will be purchasing celebratory fireworks to shoot off on July 4. However, fireworks, like many other products, sometimes have significant government costs built into their price. This July 4, consumers in at least 3 states (Texas, Indiana, and Michigan) will pay excise taxes on fireworks, and consumers in the vast majority of states will face fireworks price tags that include often high license fees paid by distributors.

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July 01, 2014

Today, the Foreign Account Tax Compliance Act (FATCA) goes into force. FATCA was passed by Congress in 2010 as part of the “Hiring Incentives to Restore Employment Act of 2010” in order to ensure that those who have assets overseas are not evading their U.S. tax liability.

It does this by first requiring U.S. citizens and taxpayers to report assets held in overseas accounts worth more than about $50,000. Second, it requires foreign financial institutions to disclose financial...

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June 30, 2014

Today marks the end of the fiscal year in the Keystone State, and a state budget for 2014-2015 is poised for final passage in the Pennsylvania General Assembly in just a few hours. The proposed $29.1 billion deal increases spending in the general fund by about 2 percent from this year to next, and lawmakers have looked under nearly every couch cushion for extra funds.

The budget cobbles...

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June 30, 2014

If the Democrats in both Houses of the New Jersey Legislature have their way, the state’s 2015 budget will at last introduce a statewide “millionaires’ tax.” The proposed tax, which is meant to cover the cost of a scheduled pension payment, would create a new temporary tax bracket for those earning more than $1 million. For just the next three years, these top earners would owe 10.75 percent of their income above $1 million to the state – a jump up from the current top marginal rate of 8.97...

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June 27, 2014

Last week, the Tax Incentive Evaluation Committee, a group of Nebraskan legislators, convened to define both the goals of the state’s existing business tax incentive programs and to create a process to evaluate the programs. The committee, chaired by Senator John Harms, was originally formed to address the vague nature of the tax incentive programs’ goals. Many Nebraskan legislators believe the tax...

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June 26, 2014

Washington legislators are introducing bills to stop “tax inversions,” or the process by which corporations merge with foreign companies and move abroad to lower corporate tax burdens. This follows Medtronic’s recent inversion and comes as Walgreen Co. shareholders exert pressure on the Illinois-based corporation to do the same.

Recent legislative...

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June 26, 2014

The Pennsylvania House of Representatives has passed a measure (HB 2188) to suspend 13 different tax credits for two years, thereby reducing the state’s deficit by $48 million. According to the associated fiscal note, the tax credits suspended would be:

  1.  Property and...
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June 25, 2014


(Courtesy Revel)

Despite receiving tax incentives, state subsidized worker training, and infrastructure support, the $2.4 billion Revel Casino Hotel in Atlantic City, New Jersey,...

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June 25, 2014

For this week's tax map, we take a look at combined tax rates on commercial jet fuel in each state. When fuel for airplanes is bought at airports, much as when fuel for cars is bought at gas stations, there are taxes owed on that fuel. The airline industry estimates that, for every penny increase per gallon in fuel costs, industry-wide fuel expenses rise $180 million, which means $180 million in extra costs for...

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June 24, 2014

The Affordable Care Act increases marginal tax rates on labor by about six percentage points and is one of the largest tax increases in the last 70 years according to economist Casey Mulligan:

“During a period that included more than a dozen tax increases, the ACA is arguably the largest as a...

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June 24, 2014

UPDATE (12:12pm): The Catania amendment was defeated 4 to 9. 

UPDATE (2:04pm): The DC Council passed the full budget 12 to 1, including the tax reform package. It now goes to the Mayor for his approval or veto.

The District of Columbia Council enters into session today at 10:00 AM to vote on a budget package that includes a major tax reform. An initial vote on May 29...

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June 23, 2014

The average U.S. worker faces a tax burden of 31.3 percent. This includes both income taxes and payrolls taxes. Between these two types of taxes, the average U.S. workers pays over $16,000 in taxes on their labor.

The tax burden is a combination of income taxes at the federal, state, and local levels as well as the employee and the employer payroll taxes. Of the 31.3 percent tax burden, 15.4 percent is...

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June 23, 2014

We've released a new video in which Tax Foundation President Scott Hodge and Economist Kyle Pomerleau explain the ins and outs of capital gains taxes in the United States.

Questions answered in the video:

  • What are capital gains?
  • What are capital gains taxes?
  • How does the U.S. treat capital gains...
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June 23, 2014

Bloomberg recently reported that the Bill and Hillary Clinton planned to avoid estate taxes by transferring their New York home to a residential trust. Their plans to avoid estate taxes are notable because of their political support for those taxes. But it’s also an excellent example of the arcane and complex nature of the estate tax and how simple reforms help to mitigate...

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Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official weblog 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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