Lunch Links: Gov. Christie Faces Deadline on NJ-PA Reciprocity Agreement; Look to Philly for Most Tax Incentives of Any Major City; Massachusetts Revenue Growth Fails to Trigger Income Tax Reduction

September 2, 2016

Today is September 2, a big day in tax history. In 1789, it’s the day the U.S. Treasury Department was created. It’s the birthday of Henry George, who promoted taxing land instead of other taxes. It’s also the date in 1965 when Congress released the Willis Commission Report, recommending changes to make state tax systems simpler and more uniform. (Nearly all of the recommendations remain unimplemented.)

Here are some interesting links I came across:

Ireland Will Appeal EU Ruling: The cabinet reached the decision after a half hour of deliberations. (BBC)

Trump Tax Plan Benefits Real Estate: The Trump plan includes a 15 percent tax rate on pass-through entities like limited liability companies, sole proprietorships, S corporations, and partnerships, compared to the 20 to 40 percent tax rate they pay now. (The New York Times)

Philadelphia Has Most Tax Incentive Programs: Philadelphia has 21 such programs, more than any other major city. The state’s high taxes and penchant for incentives make it the epitome of high-rate, narrow-base tax policy. (Pew Center on the States / Don’t Mess With Taxes)

New Jersey and Pennsylvania Residents Wait on Christie’s Tax Decision: New Jersey Gov. Christie (R) has until today to tear up the tax reciprocity agreement between New Jersey and Pennsylvania whereby the states agree not to tax each other’s residents. The pact, which dates to 1977, means New Jersey residents only pay New Jersey taxes even if they work in Pennsylvania, and Pennsylvania residents only pay Pennsylvania taxes even if they work in New Jersey. Back in 1977, New Jersey had a 2.5 percent top income tax rate and Pennsylvania had a 2 percent top income tax rate, so there wasn’t much of a gap; today, New Jersey’s is 8.97 percent and Pennsylvania’s 3.07 percent. (New Jersey 101.5 FM)

Tax Foundation Testifies in Mississippi: My colleague Nicole Kaeding offered ideas on what the state might do with its tax code. (Associated Press)

Kansas Misses August Revenue Estimates by $10 Million: Individual income taxes did $14.8 million better than estimates but corporate income taxes were off by over $9 million and sales taxes were off by $14 million. Kansas revenue estimates have been off for 10 out of the past 12 months. (The Wichita Eagle)

No Massachusetts Income Tax Cut: The state’s revenue growth fell short of the 2.5 percent level needed to trigger an income tax reduction from the current 5.1 percent to 5.05 percent. (State Tax Notes)

Making Sure Your Property Tax Bill is Correct: Kay Bell has some tips for double-checking and appealing your property tax bill. (Don’t Mess With Taxes)

States With Throwback Are Greedy Dinner Guests: Brian Strahle uses a lively analogy to explain what a state throwback rule is. Don’t be Dinner Guest #4. (LinkedIn)

Have a happy Labor Day weekend!

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