State Tax Trends

Leave Worldwide Combined Reporting in the ‘80s, Where It Belongs

Given enough time, everything old is new again—including tax ideas best consigned to history. But worldwide combined reporting, which a few states flirted with in the 1980s, is rearing its head again.

State Tax Changes Taking Effect July 1, 2023

At least 32 notable tax policy changes recently took effect across 18 states, including alterations to income taxes, payroll taxes, sales and use taxes, property taxes, and excise taxes. See if your state tax code changed.

North Carolina’s Budget Should Prioritize Pro-Growth Structural Reforms

As fiscal year 2023 draws to a close, North Carolina’s House and Senate have each passed their own versions of the biennial budget for fiscal years 2024-25. While legislative leaders have generally agreed to overall spending levels, negotiations remain ongoing to resolve different approaches to tax policy.

State Tax Reform and Relief Trend Continues in 2023

Oklahoma Adopts Franchise Tax Repeal, Eliminates Marriage Penalty

In the closing days of the 2023 legislative session, Oklahoma lawmakers repealed the state’s corporate franchise tax and eliminated the marriage penalty in its individual income tax. Both tax changes represent a positive step forward for the state.

The Commonwealth’s Case for Corporate Tax Reforms

The Pennsylvania Senate Finance Committee recently advanced two bills, SB 345 and SB 346, that would build on last year’s historic corporate net income tax (CNIT) reform.

Exploring Excise Tax Trends

The tax base around the world is shrinking for traditional excise taxes, including taxes on tobacco, alcohol, and motor fuel. But newer excise taxes on things like carbon, cannabis, and ride-sharing are on the rise. What makes a good design for these taxes and where may excise taxes go in the future as the traditional “sin tax” base continues to shrink?

Testimony: Considerations for Improving Wisconsin’s Tax Structure and Competitiveness

If Wisconsin policymakers return some of the projected continued revenue growth to taxpayers in a structurally sound and pro-growth manner, those tax cuts will benefit businesses and individuals throughout the state, leading to more innovation, more job and wage growth, more economic opportunities, and more vibrant communities.

The Faulty Revenue Estimate Behind Minnesota’s Consideration of Worldwide Combined Reporting

As Minnesota lawmakers consider making theirs the first state to mandate worldwide combined reporting, they are relying on a revenue estimate that is—this may not be the technical term—completely bogus.

New Jersey Should Take Opportunity to Make Corporate Taxes More Competitive

By letting the corporate surtax expire, eliminating taxes on GILTI, and embracing full expensing, New Jersey would take important steps toward creating a more welcoming and competitive tax environment.

Missouri Tax Package Would Set State Up for Success

Accelerating its current individual income tax triggers and setting up the corporate income tax for eventual elimination would increase Missouri’s attractiveness among states at a time when businesses are increasingly mobile and tax competition matters more than ever.

North Dakota’s Path to a Flat Individual Income Tax

Crafting a hybrid bill for a low, flat rate on a broad base—with well-designed revenue triggers to responsibly reduce rates in the future—could be an ideal way forward for the North Dakota Senate.

West Virginia Lawmakers Reach Deal on Tax Relief

In a day and age when businesses and individuals alike are increasingly mobile, West Virginians can be relieved that their state is getting off the sideline and into the action.

Tennessee Looking Toward Pro-Growth Change in 2023

With other states upping their game to attract ever-more-mobile people and businesses, lawmakers and the governor are not content to leave Tennessee’s business taxes in their current, uncompetitive form.

State Individual Income Tax Rates and Brackets, 2023

Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections:

Testimony: Considerations for Additional Income Tax Reform and Relief in Nebraska

Done responsibly, reducing income tax rates while consolidating brackets would return excess tax collections to taxpayers and promote long-term economic growth in Nebraska.

There’s Still Room for Responsible State Income Tax Relief in 2023

Forty-three states adopted tax relief in 2021 or 2022—often in both years—and of those, 21 cut state income tax rates. It’s been a remarkable trend, driven by robust state revenues and an increasingly competitive tax environment.

West Virginia Is Being Left Behind on Tax Relief

West Virginia is one of only seven states that hasn’t offered any significant tax relief since 2021—and five of the other six forgo an individual income tax.

Georgia Should Reinforce Its Tax Reform Intentions

By shifting to a flat income tax, Georgia has already made an important commitment to tax competitiveness. Although the state’s top rate threshold is already very low, a true single-rate income tax will help protect taxpayers from inflation-related tax increases and provide a buffer against rising tax rates in the future. To combine responsible rate reductions with these benefits, Georgia should create tax triggers that empower the state to keep pace with its competition.

State Tax Changes Taking Effect January 1, 2023

Most of the 2023 state tax changes represent net tax reductions, the result of an unprecedented wave of rate reductions and other tax cuts in the past two years as states respond to burgeoning revenues, greater tax competition in an era of enhanced mobility, and the impact of high inflation on residents.