Although the majority of state tax changes take effect at the start of the calendar year, some are implemented at the beginning of the fiscal year. Fourteen states have notable tax changes taking effect on July 1.
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Amidst soaring inflation, policymakers across the political spectrum proposed many ideas to soften the blow of higher prices–especially for low-income workers and families. One idea that caught on quickly: sales tax relief on groceries. The idea had its merits, but Tax Foundation research shows that it may have missed the mark.
While Wisconsin has long been one of the highest-tax states in the nation, that distinction is increasingly detrimental as businesses and individuals enjoy increased economic and geographic mobility.
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An ideal sales tax applies to a broad base of final consumer goods and services, with few exemptions, and is levied at a low rate.
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Wyoming’s low taxes are highly attractive, but policymakers are still hard at work helping the state achieve broader economic development goals.
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The sales tax is too important a part of states’ revenue toolkits to be permitted further erosion, making sales tax modernization a vital project of the 2020s.
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The better you understand taxes, the better equipped you are to make decisions about them. All taxes can be divided into three basic types: taxes on what you buy, taxes on what you earn, and taxes on what you own.
This legislative session, the sales tax on food has garnered a great deal of attention in Kansas, with policymakers on both sides of the aisle proposing the removal of groceries from the sales tax base.
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What are the three basic tax types in the American Tax Code? In this lesson plan, students will learn about taxes on what you earn, taxes on what you buy, and taxes on what you own. Learn how do these taxes fit together, how they impact government revenues and the economy, and where you may encounter them in your daily life.
Excise taxes are imposed on a specific good or activity, such as cigarettes, alcohol, and fuel. Because of their narrow base, excise taxes distort production and consumption choices. Sometimes this distortion is by design. Compare the effects of sales taxes and tobacco excise taxes with real policy examples.
Exempting groceries from the sales tax base reduces economic efficiency without achieving its objective of enhancing tax progressivity.
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Kentucky is making commendable progress toward a more modern and competitive tax code, but more work on comprehensive tax reform should be prioritized next session.
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After a whirlwind of cuts and reforms in 2021, it looks like 2022 might be an even bigger year for state tax codes. Republican and Democratic governors alike used their annual State of the State addresses to call for tax reform, and there is already serious momentum from state lawmakers nationwide to get the job done.
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Facts & Figures serves as a one-stop state tax data resource that compares all 50 states on over 40 measures of tax rates, collections, burdens, and more.
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As Kentucky policymakers make final decisions on tax relief this year, they should make the most of this opportunity to return excess tax collections in a manner that would also enhance the Bluegrass State’s prospects for long-term economic growth.
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Even if 2022 sees many tax reforms, the scope of Iowa’s tax relief measures is likely to stand out. With the most recent reform package, Iowa lawmakers have made a significant investment in a more competitive tax climate for an increasingly competitive era.
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If Nebraska is to create a competitive environment and attract in-state investment, comprehensive tax modernization must be a priority.
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While many factors influence business location and investment decisions, sales taxes are something within policymakers’ control that can have immediate impacts.
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