The Hawaii Legislature forced through several tax increases near the end of the legislative session, including raising the income tax as well as excise taxes on cigarettes and other tobacco products. With the exception of the cigarette tax increase, all these tax hikes were vetoed by Governor Linda Lingle on May 7 in Hawaii's first-ever public veto ceremony attended by nearly a thousand taxpayers and citizens. However, on May 11 the state legislature was able to override each of the vetoes.
In this edition of the Tax Policy Podcast, Manager of State Relations Tonya Barr talks with Jamie Story, President of the Grassroot Institute of Hawaii, discussing how these tax increases could affect the Aloha State's residents and businesses.
Fiscal policy in the Garden State reads like a "what not to do" for policymakers and stakeholders. The corporate income tax combines a high rate, onerous rules, and lavish subsidies for the politically connected. The sales tax is one of the highest in the country. The state is one of five in the country to adopt a heavy individual income tax on high-income earners, which has reduced economic activity in the state. New Jersey residents also pay more property tax per capita than residents of any other state.
In this edition of the Tax Policy Podcast, Tax Foundation manager of media relations Matt Moon talks with director of state projects Joseph Henchman about the tax proposals of three gubernatorial candidates in New Jersey: incumbent Gov. Jon Corzine (D), former U.S. Attorney Chris Christie (R) and former Bogota mayor Steve Lonegan (R). Next Tuesday, June 2, New Jersey will be holding primary elections, and the gubernatorial candidates have been talking taxes, mirroring the national concern with revenue and spending.
President Obama has recently proposed to raise more than $100 billion in new tax revenues from U.S. businesses by restricting their ability to defer paying taxes on profits earned abroad. The Obama administration has also fused the issue of tax deferral with the unrelated issues of bank secrecy and tax havens.
In this edition of the Tax Policy Podcast, Tax Foundation Manager of Media Relations Matt Moon talks with Senior Research Fellow Robert Carroll, Ph.D. Carroll was the former Deputy Assistant Secretary for Tax Analysis under Hank Paulson in the previous administration. Carroll goes through the differences between tax havens and tax competition, America's place in the world when it comes to corporate taxes, and the case study of Great Britain and their experience with global tax competition.
An issue that taxpayers and officials across the country are following this year is state budgets. In January, the Tax Foundation released a report on the issue, looking at the 45 states with budget shortfalls.
Taxes are a very important part of how different states fare economically, but it's not the only important variable. In this edition of the Tax Policy Podcast, Staff Economist Josh Barro talks with Jonathan Williams, Director of the Tax and Fiscal Policy Task Force at the American Legislative Exchange Council (ALEC). Williams discusses a new report from ALEC which he, along with Dr. Arthur B. Laffer and Stephen Moore, authored: Rich States, Poor States, a measure of each states' economic competitiveness. Besides taxes, the report also goes over debt service, public employees, state liability systems, minimum wage and workers' compensation regulations.
In this week's edition of the Tax Policy Podcast, Manager of State Relations Tonya Barr talks with Joseph Coletti, Fiscal and Health Care Policy Analyst at the John Locke Foundation in Raleigh, North Carolina. Joe goes through foundation's new report, "Tax Reform in North Carolina," which recommends instituting a flat "consumed income tax," repeal of the corporate income tax and the elimination of all special tax breaks for new and existing businesses.
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Congress is currently in recess, but issues of taxes, government spending and economic growth continue to be on the minds of Americans. Monday, April 13 was Tax Freedom Day, the date on which Americans will have worked long enough to have earned enough money to pay this year's tax obligations at the federal, state and local levels. The Tax Foundation also recently released a poll showing that 56% of Americans believe that their federal income taxes are "too high" and a record 85% believing that the federal income tax code is "too complex" or "somewhat complex."
To give some perspective on the tax code and what reforms are needed, Tax Foundation Manager of Media Relations Matt Moon talks with Ari Fleischer, former White House press secretary under President George W. Bush, and now president of Ari Fleischer Sports Communications in New York City.
Just recently, the Democratic controlled House approved its version of the budget, 233 voting yes and 196 voting no. The Democratic controlled Senate approved its version, 55 voting yes and 43 voting no. Republicans in the minority have also come out with alternative versions of the budget.
In this edition of the Tax Policy Podcast, Tax Foundation Manager of Media Relations Matt Moon talks with Congressman Tom Price (R-GA 6th District), chairman of the Republican Study Committee. Price discusses why the RSC decided to come up with an alternative budget, and explains the differences between the two parties' budgets when it comes to overall spending, deficit spending, tax provisions, Social Security and Medicare. Price also discusses some budget reform proposals, including a proposal to creating "Family Budget Protection Accounts."
The Tax Foundation recently did an analysis of a tax proposal from Illinois Governor Pat Quinn (D) that would raise the personal income tax rate from 3 percent to 4.5 percent and the corporate income tax rate from 7.3 percent to 9.7 percent. Staff Economist Josh Barro, author of the 2009 State Business Tax Climate Index (a study that measures how well a state's tax system encourages investment by maintaining a broad tax base and low rates), analyzed the tax proposal's effects on Illinois' business tax climate ranking. Based on current tax law, Illinois ranked 23rd out of 50 states for business-friendliness of its tax code. With Quinn's plan in effect, Illinois' ranking would have sunk to 31st.
In this edition of the Tax Policy Podcast, Barro talks with Kristina Rasmussen, Executive Vice President of the Illinois Policy Institute, heading the organization's Springfield office. Barro and Rasmussen discuss the effect of Gov. Quinn's plan on the Prairie State as well as what Illinois should do over the long term to avoid future budget crises.
"If the government suddenly said you would incur more onerous and expensive tax regulations and reporting requirements if you moved your business to a low-tax state such as Texas or Florida from a high-tax state such as New York or California, you would be justifiably outraged. Now substitute Switzerland and Bermuda for Texas and Florida, and France and Germany for New York and California, and you'll understand a new form of 'tax protectionism' that is infecting Washington."
That was written by Dr. Richard Rahn, senior fellow at the Cato Institute, in an op-ed entitled "In Defense of Tax Havens." In this edition of the Tax Policy Podcast, Manager of Media Relations Matt Moon talks with Rahn about various proposals in Congress that would increase taxes, penalties and regulations on investment in low-tax jurisdictions rather than high-tax jurisdictions, as well as the importance of tax competition and financial privacy.
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The Obama administration has recently presented its budget in the midst of a recession. Denver Postcolumnist David Harsanyi believes that while most "presidents helped ease us out of these tough spots by easing the burden on Americans," the tax provisions within the budget show that "Obama has engaged in the opposite."
In this edition of the Tax Policy Podcast, Tax Foundation Manager of Media Relations Matt Moon talks with Harsanyi as he offers some political analysis of the Obama administration's fiscal policies, arguing that the President now owns the economic crisis. He also briefly reviews fiscal policy in Colorado.
Harsanyi's March 11 column, "Now You Own It, Mr. President," can be found here.
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Outside of the short term policies that have been presented, from the stimulus to the budget, the Obama Administration has indicated that it plans to include fundamental tax reform as part of its long term agenda.
In the podcast, Carroll and Rogers discuss principles they agreed on (simplicity, transparency, promoting savings, rethinking tax expenditures, and an environmentally motivated tax policy) as well as principles where they had divergent viewpoints (the appropriate size and role of government along with the appropriate level of progressivity in the tax code.)
Click here to learn more about the Tax Foundation's work on tax reform. Visit Rogers's blog at EconomistMom.com.
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On the heels of President Barack Obama's recent release of his fiscal year 2010 budget, Congressman Paul Ryan (R-WI 1st District), ranking Republican on the House Budget Committee, is pushing for major reform in the areas of tax, monetary and entitlement policy, criticizing the new administration's budget as having the practical effect of taxing "work, savings, investment, capital and risk-taking far more than we are today" and "hurting our chances of coming out this recession robustly."
In a discussion with Tax Foundation Manager of Media Relations Matt Moon in this week's edition of the Tax Policy Podcast, Ryan proposes a two-tiered individual income tax system with the top marginal tax rate cut to 25% and the lower bracket cut to 10% for the first $100,000 for couples, as well as a cut in the corporate tax rate to 25%.
Ryan's op-ed in the March 2, 2009 edition of the Wall Street Journal on this subject can be found here. His plan for long term fiscal reform, "A Roadmap for America's Future," can be found at www.americanroadmap.org.
In this edition of the Tax Policy Podcast, we turn to the recently passed federal stimulus package. Tax Foundation Vice President for Economic Policy Robert Carroll, PhD, talks with Robert Barro, the Paul M. Warburg Professor of Economics at Harvard University in Cambridge, Massachusetts. Professor Barro is also a senior fellow of the Hoover Institution at Stanford University and a research associate of the National Bureau of Economic Research. Barro focuses his criticism on both the spending and tax provisions in the stimulus legislation, and makes some recommendations to lawmakers regarding permanent changes to the tax code that could spur long term incentives.
Check out the latest study from Robert Carroll and Mark Robyn on tax savings from the recently passed stimulus package here.
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In this edition of the Tax Policy Podcast, we continue our discussion of state budget shortfalls. Tax Foundation Manager of Media Relations Matt Moon talks with Peter Nelson, Policy Fellow with the Center of the American Experiment in Minneapolis, a nonpartisan, tax-exempt public policy organization focusing on free market ideas for Minnesota and the nation. Peter discusses Governor Tim Pawlenty's budget proposal for 2009-10 and makes recommendations to Minnesota lawmakers on how the current fiscal situation may be an opportunity to enact tax reform in the North Star State.
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 fiscal crises. Henchman also makes recommendations to state and local government officials on how to face these difficult budget situations.
Don't forget to visit the Tax Foundation's Center for State Fiscal Policy for the latest research and data on state and local taxes.
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With a new Congress and a new administration focused on a short term stimulus proposal to get America out of the current economic downturn, others are focused on long term plans involving taxes to spur investment, create jobs and increase our standard of living. In this edition of the Tax Policy Podcast, Tax Foundation President Scott Hodge discusses corporate tax reform proposals and global tax competition with Alex Brill, research fellow at the American Enterprise Institute and economic policy adviser at Buchanan Ingersoll & Rooney PC.
To see Brill's latest paper published in the January 2, 2009 edition of Tax Notes, "Corporate Tax Rates: Receipts and Distortions," click here. For more on corporate taxes, visit the Tax Foundation's CompeteUSA campaign.
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Like many states this year, California is going through a fiscal crisis, measured by some as a $40 billion deficit with current spending proposals. In this edition of the Tax Foundation's Tax Policy Podcast, Tax Counsel and Director of State Projects Joseph Henchman interviews Jon Coupal, President of the Howard Jarvis Taxpayers Association. They discuss HJTA’s recent lawsuit over the rushed majority-vote “passage” of the California budget, why the 2/3 rule is important, and prospects for sound tax policy in California.
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The new year brings new legislative sessions in every state. And almost every state is going through tough fiscal times in the midst of this economic downturn. While every state legislature and governor is figuring out what to tax, how to spend and where to cut, there are some who see state fiscal crises as an opportunity for government reform.
Staff Economist Josh Barro talks with David Yepsen, columnist from the Des Moines Register, to discuss his suggestions for fiscal reform in Iowa.
You can find Yepsen's column on the potential for fiscal reform in the Hawkeye State here.
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As the 111th Congress starts, the Democratic majority is proposing to reauthorize the State Children's Health Insurance Program (SCHIP), which might include increased funding and expanded coverage, from children in families making twice the poverty level to possibly three or four times the poverty level. All of this would be paid for by an increase in the federal cigarette tax from 39 cents for $1 per pack. Phil Kerpen, Director of Policy for Americans for Prosperity, goes through some of the details of this proposal and explains why the cigarette tax hike would disproportionally hit those at lower income levels. You can read Phil's op-ed in the Washington Times on this subject here.
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Congressman Jim McCrery, the winner of this year's Tax Foundation Distinguished Service Award, represents Louisiana's 4th Congressional District, encompassing northwest and west central Louisiana, and is serving his tenth and final term in the U.S. House of Representatives. McCrery is the ranking minority member of the House Ways and Means Committee, and also serves on the Joint Committee on Taxation. Tax Foundation President Scott Hodge talks with Congressman McCrery about his accomplishments in tax legislation as well as what we should expect from when it comes to America's economic future.
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While most people on the street and in the media were focusing on the Presidential race as well as major Congressional elections, there were many tax-related measures on the ballot in many states. In this edition of the Tax Policy Podcast, Tax Foundation Tax Counsel Joseph Henchman talks with Josh Culling, State Government Affairs Manager at the National Taxpayers Union, about the results of some of these initiatives in various states as well as what the trends might be when it comes to future legislation and ballot measures on fiscal policy.
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Last month, the Tax Foundation released the 2009 State Business Tax Climate Index, a measure of the "business-friendliness" of each state's tax system, providing a roadmap for state lawmakers concerned with keeping their states tax-competitive. In Part Three of the Tax Policy Podcast's Index Tour, we talk with Christopher Summers of the Maryland Public Policy Institute. Maryland had a large slide down our Index, going from 24th in 2008 to 45th in 2009. Chris discusses what happened legislatively last year contributed to this slide, and offers thoughts on Maryland's budget situation.
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Last month, the Tax Foundation released the 2009 State Business Tax Climate Index, a measure of the "business-friendliness" of each state's tax system, providing a roadmap for state lawmakers concerned with keeping their states tax-competitive. In Part Two of the Tax Policy Podcast's Index Tour, we talk with Bill Felkner, President of the Ocean State Policy Research Institute in Providence. Rhode Island moved up from 49th to 46th on the Index, and Felkner provides some thoughts on the improvement and what can be done to move the state up further.
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Last month, the Tax Foundation released the 2009 State Business Tax Climate Index, a measure of the "business-friendliness" of each state's tax system, providing a roadmap for state lawmakers concerned with keeping their states tax-competitive. In Part One of the Tax Policy Podcast's Index Tour, we talk with Gregg Edwards of the Center for Policy Research of New Jersey, explaining why the Garden State ranks dead last in the Index and what legislators in Trenton can do about it.
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The Tax Policy Podcast is the official podcast 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 via email: podcast@taxfoundation.org.
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Disclaimer: All views expressed in the Tax Foundation's Tax Policy Podcast are those of the individual guests, and do not necessarily represent the views of the Tax Foundation, its Board of Directors, or its financial contributors. The Tax Foundation makes no representation concerning the views expressed, and does not guarantee the source, originality, accuracy, completeness or reliability of any statement, information, data, finding, interpretation, advice, opinion, or view presented.
