Explaining the GAAP between Book and Taxable Income
A recent study identifies dozens of large companies that paid no income taxes in 2020. While such studies get headlines and may seem shocking, the reality is much more mundane.
5 min read
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Biden Proposals Would Significantly Expand Benefits Administered Through the Tax Code
The Biden administration will have to balance the desire to increase social spending through the tax code with the need to collect revenue and have a tax system that is transparent and easy to understand.
5 min read
Ohio Lawmakers Ponder Tax Relief after Rosy Revenue Outlook
Ohio is one of a growing number of states which experienced revenue increases despite the economic slowdown from the coronavirus pandemic and is now looking to return some of that through tax relief.
5 min read
Carbon Taxes in Europe, 2021
In recent years, several countries have taken measures to reduce carbon emissions, including instituting environmental regulations, emissions trading systems (ETS), and carbon taxes.
3 min read
How Well-Funded Are Pension Plans in Your State?
Although most states are on solid financial footing following the coronavirus crisis, pension liabilities are a deep-seated problem that long predates the pandemic.
2 min read
Closer Look at Option to Restructure EITC/CTC to Help Low-Income Households
We take a closer look at the most extensive of these proposals: restructuring the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) based on the Family Security Act proposed by Sen. Mitt Romney (R-UT) in February.
3 min read
Countries Should Be Cautious about Relying on Inheritance Taxes for Revenue
As tempting as inheritance, estate, and gift taxes might look especially when the OECD notes them as a way to reduce wealth inequality, their limited capacity to collect revenue and their negative impact on entrepreneurial activity, savings, and work should make policymakers consider their repeal instead of boosting them.
5 min read
Montana Adopts Individual and Corporate Income Tax Reform
Montana adopted structural reforms to both individual and corporate income taxes during the recently adjourned legislative session, enacting three bills reducing individual tax rates, simplifying the state’s individual tax system, repealing 16 tax credits, and changing the apportionment factor for corporate income tax.
5 min read
Less Should be MORE with Federal Cannabis Taxation
Federal lawmakers re-introduced the MORE Act, the most significant federal legislative development on marijuana policy in 50 years. The MORE Act would impose a federal excise tax on marijuana at a rate from 5 to 8 percent.
7 min read
Arizona Legislators Consider Lower, Flatter Income Tax
The income tax changes in HB 2900 as introduced would improve Arizona’s individual income tax structure and economic competitiveness, making the state more attractive to individuals and pass-through businesses .
8 min read
Tax Relief for Families in Europe
Most countries provide tax relief to families with children—typically through targeted tax breaks that lower income taxes. While all European OECD countries provide tax relief for families, its extent varies substantially across countries.
2 min read
How Does Your State Treat Social Security Income?
Thirteen states tax Social Security benefits, a matter of significant interest to retirees. Each of these states has its own approach to determining what share of benefits is subject to tax, though these provisions can be grouped together into a few broad categories.
4 min read
Oklahoma Passes Corporate and Individual Income Tax Reductions
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.
3 min read
Tax Foundation Webinar Recaps the Complexities of the 2021 Tax Filing Season
During the pandemic, economic relief administered through the tax code exploded as Congress passed nearly $6 trillion of legislation into law. That left the 2021 tax filing season, which ended May 17, with complications that still linger.
4 min read
Reviewing Recent Evidence of the Effect of Taxes on Economic Growth
With the Biden administration proposing a variety of new taxes, it is worth revisiting the literature on how taxes, particularly on corporate and individual income, can impact economic growth.
9 min read
How Much Does Your State Collect in Property Taxes Per Capita?
Property taxes are an important source of revenue for local and state governments. In FY 2018, property taxes generated over 30 percent of total U.S. state and local tax collections and over 70 percent of local tax collections.
2 min read
A Comparison of the Tax Burden on Labor in the OECD, 2021
Governments often justify higher tax burdens with more extensive public services. However, the cost of these services can be more than half of an average worker’s salary.
21 min read
How Biden’s Corporate Tax Increases Could Make Tax Enforcement Harder
If Biden wants to reduce tax evasion, raising the corporate rate, increasing the incentives to engage in tax evasion, and creating a larger tax advantage to becoming a pass-through business is counterproductive.
3 min read
Joint Committee on Taxation Data Shows Federal Tax System Is Progressive
New Joint Committee on Taxation (JCT) data indicates that the federal tax system is progressive, consistent with similar analysis by the Congressional Budget Office (CBO), and the OECD.
2 min read
Financing Infrastructure Spending with Corporate Tax Increases Would Stunt Economic Growth
The Biden administration’s American Jobs Plan proposal to fund infrastructure spending relies on a bet that the benefits outweigh the costs of a higher corporate tax burden. Using the Tax Foundation model, we find that this trade-off is a bad one for the U.S. economy, resulting in reduced GDP, less capital investment, fewer jobs, and lower wages.
3 min read