The Tax Foundation is the world’s leading independent tax policy 501(c)(3) nonprofit. For over 80 years, our mission has remained the same: to improve lives through tax policies that lead to greater economic growth and opportunity.
Our Center for Federal Tax Policy, Center for State Tax Policy, and Center for Global Tax Policy each produce timely and high-quality research and analysis that influences the debate toward economically principled tax policies. Our experts are continuously analyzing the day’s most relevant tax policy topics and are relied upon routinely for presentations, testimony, and media appearances on tax issues spanning every level of government.
Likewise, providing journalists, taxpayers, and policymakers with basic data on taxes and spending has been a cornerstone of the Tax Foundation’s educational mission since its founding. As we wrote in our first edition of Facts & Figures in 1941, “Facts give a broader perspective; facts dissipate predilections and prejudices…[and are] an important step to meet the challenge presented by the broad problems of public finance.”
In recognition of the fact that there are better and worse ways to raise revenue, our Index focuses on how state tax revenue is raised, not how much. The rankings, therefore, reflect how well states structure their tax systems.
111 min read
While there are many factors that affect a country’s economic performance, taxes play an important role. A well-structured tax code is easy for taxpayers to comply with and can promote economic development while raising sufficient revenue for a government’s priorities.
88 min read
The federal tax code remains a major source of frustration and controversy for Americans, and a hindrance to economic growth and opportunity. Other countries, such as Estonia, have proven that sufficient tax revenue can be collected in a less frustrating and more efficient way.
42 min read
Tax burdens rose across the country as pandemic-era economic changes caused taxable income, activities, and property values to rise faster than net national product. Tax burdens in 2020, 2021, and 2022 are all higher than in any other year since 1978.
24 min read
States are unprepared for the ongoing shift to remote and flexible work arrangements, or for the industries and activities of today, to say nothing of tomorrow. In some states, moreover, existing tax provisions exacerbate the impact of high inflation and contribute to the supply chain crisis.
40 min read
A landmark comparison of corporate tax costs in all 50 states, Location Matters provides a comprehensive calculation of real-world tax burdens, going beyond headline rates to demonstrate how tax codes impact businesses and offering policymakers a road map to improvement.
8 min read
In tax year 2020, taxpayers claimed more than 159 million tax credits on their individual income tax returns worth a total of more than $277 billion. That was an increase of $35.3 billion from tax year 2019, largely due to an influx of pandemic relief administered through the tax code in 2020.
6 min read
California pumps out the highest state gas tax rate of 77.9 cents per gallon (cpg), followed by Illinois (66.5 cpg) and Pennsylvania (62.2 cpg).
2 min read
The aim of patent boxes is generally to encourage and attract local research and development (R&D) and to incentivize businesses to locate IP in the country. However, patent boxes can introduce another level of complexity to a tax system, and some recent research questions whether patent boxes are actually effective in driving innovation.
3 min read
However well-intended they may be, sales tax holidays remain the same as they always have been—ineffective and inefficient.
4 min read
Capital allowances play an important role in a country’s corporate tax base and can impact investment decisions—with far-reaching economic consequences.
4 min read
Compare the latest 2023 sales tax rates as of July 1st. Sales tax rate differentials can induce consumers to shop across borders or buy products online.
8 min read
As the EU pursues massive changes in public policy as part of its green transition, expect fuel taxes to be central to any policy discussions.
4 min read
Reviewing reported income helps to understand the composition of the federal government’s revenue base and how Americans earn their taxable income. The individual income tax, the federal government’s largest source of revenue, is largely a tax on labor.
9 min read
Taxes are the single most expensive ingredient in beer, costing more than the labor and raw materials combined.
3 min read
It’s unlikely these implemented and proposed windfall taxes will achieve their goals of raising additional revenues without distorting the market. Instead, they would penalize domestic production and punitively target certain industries without a sound tax base.
13 min read
Of all alcoholic beverages subject to taxation, stiff drinks—and all distilled spirits—face the stiffest tax rates. Like many excise taxes, the treatment of distilled spirits varies widely across the states.
4 min read
In most European OECD countries, corporate income is taxed twice, once at the entity level and once at the shareholder level.
3 min read
States are in a better position to attract business investment when they maintain competitive real property tax rates and avoid harmful taxes on tangible personal property, intangible property, wealth, and asset transfers.
3 min read
In the United States, tobacco is taxed at both the federal and state and sometimes even local levels. These layers of taxes often result in very high levels of taxation—the highest of any consumer item. The retail price of cigarettes, for instance, is more than 40 percent taxes on average. In some states, like Minnesota and New York, more than 50 percent of the price paid by consumers comes from taxes.
2 min read
To make the taxation of labor more efficient, policymakers should understand the inputs into the tax wedge, and taxpayers should understand how their tax burden funds government services.
3 min read
This web tool allows taxpayers to see how cigarette tax revenues have changed since 1955. Across almost all states, a clear pattern of volatility emerges. Tax rate hikes are met with a momentary bump in revenue, followed by a falloff.
2 min read
Although the U.S. has a progressive tax system and a relatively low tax burden compared to the OECD average, average-wage workers still pay more than 30 percent of their wages in taxes.
4 min read
An ideal sales tax applies to a broad base of final consumer goods and services, with few exemptions, and is levied at a low rate.
5 min read
Instead of reforming and hiking the wealth tax, perhaps policymakers should consider whether the tax is serving its intended objectives, and, if not, consider repealing the tax altogether.
4 min read
Individual income tax rates can influence location decision-making, especially in an era of enhanced mobility, where it is easier for individuals to move without jeopardizing their current job, or without limiting the scope of their search for a new one.
5 min read