Mississippi lawmakers should deliver tax relief in 2022, but they need not take an all-or-nothing approach. There are many ways to improve the state’s tax code, even if full income tax repeal doesn’t remain on the table.
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Kentucky and Tennessee won an important legal victory Friday when a federal court ruled that the American Rescue Plan Act (ARPA)’s restrictions on state fiscal autonomy were unconstitutional and enjoined (blocked) the enforcement of those provisions against both states.
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As states close their books for fiscal year 2021, many have much more revenue on hand than they anticipated last year. Eleven states have responded by reducing income tax rates and making related structural reforms as they strive to solidify a competitive advantage in an increasingly competitive national landscape.
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As Wisconsin emerges from the pandemic, state policymakers have a rare opportunity to reinvest excess revenues in a structurally sound manner that will make the state more attractive to individuals and businesses, promote a quicker and more robust economic recovery, and put the state on the path to increased in-state investment and growth for many years to come.
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Last Friday, Oklahoma Governor Kevin Stitt (R) signed House Bills 2960, 2962, and 2963 into law as part of a budget agreement, bringing the legislature’s tax plans across the finish line. These bills will reduce the state’s corporate and individual income tax rates beginning in tax year 2022.
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Raising rates on those with the most flexibility to leave—or never to return—risks turning those fears into a self-fulfilling prophesy.
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The government of Hartford County, Connecticut is in line to receive $173 million in local aid under the American Rescue Plan Act (ARPA). There’s only one problem: the government of Hartford County doesn’t exist, nor do any of Connecticut’s other counties have county-level government despite being allocated a collective $691 million under the bill.
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Here’s each state’s estimated revenue gains or losses in 2020, alongside the state and local aid that would be allocated to each under the American Rescue Plan Act.
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With 2020 nearing its close, state unemployment compensation trust funds continue to struggle under the weight of so many pandemic-created beneficiaries, though some funds are beginning to stabilize as people increasingly return to work.
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Combined state and local tax collections were down only $7.6 billion across the period, representing a total state and local tax revenue decline of 0.7 percent compared to the first nine months of 2019.
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A bipartisan coalition of Senators unveiled a $908 billion COVID-19 relief bill on Tuesday, which includes, among other provisions, $160 billion in additional aid to state and local governments. It is worth briefly exploring what this would mean, and the amounts of aid your state might expect.
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President Biden and Congress should concentrate on areas of common ground, finding incremental places to improve the tax code. A bipartisan bill recently introduced to help retirement savings is a good model for what incremental reform may look like.
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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.
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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.
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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.
7 min read
Revised state revenue forecasts show a significant decline in projected revenues for both the recently concluded FY 2020 and current FY 2021, though the picture they paint is considerably less dire than many feared a few months ago.
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The SMART Act, sponsored by Senators Bob Menendez and Bill Cassidy and Rep. Mikie Sherrill, would provide $500 billion in flexible funding to state and local governments.
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The HEROES Act, proposed by House Democrats as a next round of fiscal relief during the coronavirus outbreak, contains about $1.08 trillion in aid to states and localities. That would bring the pandemic total to $1.63 trillion—an amount so large that it might overwhelm their ability to spend it and could reward fiscal irresponsibility.
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The HEROES Act would provide more than $1 trillion to state and local governments. Here’s how funding would be distributed and provisional estimates of how much aid each state would receive.
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The COVID-19 pandemic and accompanying economic downturn will wreak havoc on state and local tax revenues, with projections of a 15-20 percent decline in state revenues. Our new report provides a framework for how to design an effective state and local relief package.
35 min read