Academic studies show that higher corporate tax rates depress worker wages and lead to fewer jobs. An Organisation for Co-operation and Development (OECD) study has found that the corporate tax is the least efficient and most harmful way for governments to raise revenue.
Corporate taxation has evolved significantly, with rates coming down significantly over the last several decades. Countries have redesigned their tax bases by changing the treatment of losses, interest, and capital costs. A recent OECD report highlights the general stabilization of corporate tax revenues and statutory rates alongside major changes to address profit-shifting opportunities.
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Our analysis shows that the economic benefits of federal investment in productivity-enhancing infrastructure may be undercut by the negative effects of the financing of those investments, such as when the corporate income tax is increased.
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Countries around the world have implemented and continue to implement emergency tax measures to support their economies during the coronavirus (COVID-19) crisis.
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While other states are starting to think about the recovery, California is contemplating tax policies that would stand in the way of economic expansion once the health crisis abates. California’s shortfall is all too real, but tax policies which impede recovery are a hindrance, not a help.
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State recovery plans should lessen the burden on businesses by shifting from capital stock taxes and other taxes that are charged regardless of profitability. Louisiana does well to target its Corporation Franchise Tax, a burdensome tax that would target businesses that may already be struggling.
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Governments at all levels must work to remove the tax policy barriers that stand in the way of economic recovery and long-term prosperity following the COVID-19 crisis. Our new guide outlines several comprehensive options that policymakers can take at the federal and state levels.
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Have you ever wondered where the money comes from to build roads, maintain a national defense, or pay for programs like Social Security? Taxes.
Discover the three basic tax types—taxes on what you earn, taxes on what you buy, and taxes on what you own. Learn about 12 specific taxes, four within each main category. Develop a basic understanding of how these taxes fit together, how they impact government revenues and the economy, and where you may encounter them in your daily life.
Discover why there are better and worse ways for governments to raise a dollar of revenue. Compare the economic impact of the three basic tax types—taxes on what you earn, buy, and own—including three specific taxes within each category. Learn about the basics of “dynamic scoring,” one tool economists can use to compare the economic and revenue impact of different tax policies.
Identify some of the most common tax myths and tax policy misconceptions and learn how to separate fact from fiction. Discover why tax refunds shouldn’t be celebrated, why you should pay your income tax bill, and why certain deductions are wrongly labeled “loopholes,” among other useful facts. Improve your ability to counter misleading arguments about the tax code.
Many states are racing to pass budgets, emergency COVID-19 supplemental appropriations, and other must-pass legislation as quickly as possible. We’re tracking the latest state legislative responses to the coronavirus crisis.
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New Jersey is temporarily waiving corporate nexus arising from employees teleworking due to the COVID-19 pandemic—a response to the crisis that other states should follow.
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During the present crisis, remote work has become a necessity for many people. The tax implications, however, are very real and potentially quite complex.
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Countries around the world are implementing emergency tax measures to support their economies under the coronavirus (COVID-19) threat.
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The Great Recession provides some insight into how tax revenues declined during a deep recession. Across OECD countries, revenues fell by 11 percent from 2008 to 2009 with corporate income taxes seeing the steepest decline at 28 percent. Revenues from individual income taxes fell by 16 percent.
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In the short term, states must anticipate reduced tax collections as the economy slows. And here, not all taxes are created equal. As a general rule, income taxes are more volatile than consumption taxes.
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As policymakers consider ways to facilitate investment, effective average tax rates provide a valuable perspective on where burdens on those activities are high and where they are low.
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