Tax Policy Blog

Where Does Kamala Harris Stand on Tax Policy?

What tax policy ideas did Harris propose along the campaign trail, and how do they differ from Biden’s plan?

Estimating Neutral Cost Recovery’s Impact on Affordable Housing

Housing affordability was a major issue even before the COVID-19 crisis, but the current economic situation has made it more salient. Immediate support for people struggling makes sense now, but lawmakers should also consider long-term solutions to the problem of high rents, namely by expanding the supply of housing.

Higher Taxes Might Not Be the Solution for Canada and its Provinces

First, the introduction of the wealth tax would significantly impact international capital flows and cause large economic dislocations in the short term. Second, provinces that are looking at raising their corporate tax rates might hinder capital attraction, growth, and economic recovery.

Vermont May Be the Next State to Legalize Recreational Marijuana Sales

According to news reports, the Vermont legislature is ready to advance S54 this month or next, to legalize cultivation and sales of marijuana in the state beginning in 2022.

Evidence Suggests that Tax Rates Influence Migration Decisions

Individuals respond to taxes by changing their behavior. Hence, when there are tax differences between countries, some might respond by moving to a lower-tax area. For higher-income individuals, the benefits of moving as a result of higher taxes are greater because they have more income or wealth at stake.

Who will Ultimately Pay the Digital Services Tax in the UK? Amazon Passes the Cost Along to Sellers

When developing tax policy, lawmakers often ignore the incidence of a tax, or who actually pays the tax. Many times, this is different from who is legally required to pay the tax. Just because a 2 percent revenue tax applies to large digital companies does not mean that the companies will bear the entire cost of the tax.

Massachusetts Ban of Flavored Cigarettes Is Getting Expensive

Aside from public health concerns, a ban on flavored tobacco, especially when including cigarettes, has significant tax implications and could result in unintended consequences such as increased smuggling. In Massachusetts, more than 20 percent of cigarettes smoked are purchased out of state.

Coronavirus Assistance for American Families Act Would Provide More Generous Rebates for Dependents

On Thursday, U.S. Senators Marco Rubio (R-FL), Bill Cassidy (R-LA), Steve Daines (R-MT), and Mitt Romney (R-UT) released the Coronavirus Assistance for American Families Act (CAAF), which would provide payments of $1,000 to adults and children with Social Security numbers, subject to income limits used in the original round of rebates. Among other modifications, it would be more generous to households and families with children when compared to the original rebates distributed under the CARES Act.

Brazil has the Opportunity to Implement a Simple Consumption Tax and Foster Tax Progressivity at the Same Time

Brazil has one of the world’s most complex tax systems. Brazil has the opportunity to implement a simple consumption tax and foster tax progressivity at the same time.

State Income and Sales Tax Revenues Slide in Second Quarter

Today marked the release of second-quarter GDP data and provides a new glimpse into early changes in state and local revenues and spending. All told, second-quarter state and local tax receipts came in about 3.8 percent lower than they did in the same quarter a year ago. Income and sales taxes fell considerably while property and excise tax collections remained stable.

Three-Fourths of New 2016 Investment Was Excluded from Improved Cost Recovery

New data sheds light on what share of new business investment was eligible for bonus depreciation as it existed before 2017 tax reform, and what share of new investment was excluded from improved cost recovery. This matters because the income tax is biased against investment in capital assets to the extent that it makes the investor wait years or decades to claim the cost of machines, equipment, or factories on their tax returns.

Senate Republicans Introduce the HEALS Act for Coronavirus Pandemic Relief

A resurgence in coronavirus cases and receding economic activity in many states threaten the nascent economic recovery. To address the ongoing crisis, the Senate Republican Phase 4 proposal builds on the CARES Act provisions while modifying others, including a scaled down federal UI benefit.

Revenue Gains in Asian and Pacific Countries Likely Offset by COVID-19

Because of the COVID-19 pandemic and the associated economic crisis, countries in the Asia-Pacific region will see a differentiated impact on their capacity of mobilizing domestic revenue depending on the structure of their economy. According to the OECD report, those economies that rely mostly on natural resources, tourism, and trade taxes are especially vulnerable.

New York and New Jersey Consider Financial Transaction Taxes

Seeking new sources of funding, New York and New Jersey—two states at the heart of global financial markets—are considering financial transaction taxes.

Austria Is Mulling an Allowance for Corporate Equity

While not a short-term measure to alleviate the economic losses resulting from the current crisis, experience from other countries has shown that a tax allowance for corporate equity can be a sensible long-term policy that can strengthen Austria’s investment environment and improve financial stability.

The History of Excess Profits Taxes Not as Effective or Harmless as Today’s Advocates Portray

Today’s advocates would do well to study the history of excess profits taxes before overselling these taxes as a solution to the COVID-19 crisis.

The New EU Budget is Light on Details of Tax Proposals

The European Council recently agreed on a new multiannual budget and a recovery program, which sets EU budget levels for 2021-2027 totals €1 trillion (US $1.2 trillion). The lack of details on the various tax proposals and the eventual need for revenue sources to finance new EU debt mean there is a lot of work left for policymakers in Brussels to do.

Debunking 3 Myths About the Mortgage Interest Deduction

(Webinar) Figuring Out Phase Four: Next Steps on Federal and State Coronavirus Response

As U.S. businesses struggle to recover from the economic downturn, Congress and the White House continue to debate a phase four relief package, which could include anything from incentives for domestic travel and a payroll tax cut to more fundamental reforms like enacting permanent full cost recovery.

Tax Options to Promote Short-Term Recovery and Long-Term Economic Growth in Wisconsin

From a revenue standpoint, Wisconsin was better off than many states going into this crisis, but the policy decisions—including tax policy decisions—state policymakers make in the months ahead will have far-reaching implications for how quickly jobs and wages are restored in Wisconsin.