State revenue stabilization funds, often called rainy day funds, are better funded now than they were at the start of the Great Recession and can be a valuable tool as states face a sharp pandemic-linked economic contraction.
18 min read
Another 1.4 million Americans filed initial regular unemployment benefit claims, the eleventh week of a decline in the rate of new claims, but still among the highest levels in U.S. history. The total number of new and continued claims now stands at 19.3 million, a marked decline from the peak of 24.9 million a month ago.
7 min read
The extent to which businesses and consumers will benefit from coronavirus relief measures like temporary VAT changes will depend on the VAT base.
2 min read
Rainy day funds have increasingly emerged as a standard component of states’ budgeting toolkits. Economic cycles can have significant impacts on state revenue, but states can prepare for the inevitable downturns during good times by putting away money in a revenue stabilization fund.
2 min read
Due to certain VAT exemption thresholds, many small businesses will not be able to benefit from the VAT changes being introduced throughout Europe to provide relief during the COVID-19 crisis.
2 min read
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.
16 min read
While lawmakers are working through the design of vapor tax proposals, they must thread the needle between protecting adult smokers’ ability to switch and barring minors’ access to nicotine products. A good first step is creating appropriate definitions for the new nicotine products to avoid unintended disproportionate taxation based on design differences or bundling.
7 min read
One notable consequence of high state tobacco excise tax rates is increased smuggling as people procure discounted products from low-tax states and sell them in high-tax states. Smugglers wouldn’t have to look far to find cheaper smokes. All of Maryland’s neighboring states have rates lower than $4 per pack, including Virginia ($1.20) and West Virginia ($0.30). Such an increase would impact the many small business owners operating vape shops around the state and convenience stores relying heavily on vapers as well as tobacco sales.
7 min read
The latest IRS data shows that the U.S. individual income tax continues to be very progressive, borne primarily by the highest income earners. The top 1 percent of taxpayers pay a 26.8 percent average individual income tax rate, which is more than six times higher than taxpayers in the bottom 50 percent (4.0 percent).
6 min read