Tax Law

Minnesota High Court Ruling Will Increase Business Tax Compliance Costs

With a changing economy—the law is about companies selling tangible products, but our economy is increasingly service-oriented—and state-level tests to the ongoing validity of the law, perhaps the time has come for Congress to update and expand upon these protections, which are designed to limit states from imposing substantial tax remittance and compliance burdens on businesses with only the most minimal of contacts with the state.

State Tax Ballot Measures to Watch in 2024

Taxes are on the ballot this November—not just in the sense that candidates at all levels are offering their visions for tax policy, but also in the literal sense that voters in some states will get to decide important questions about how their states raise revenue.

Modernizing State Sales Taxes: A Policymaker’s Guide

The sales tax is the second-largest source of state tax revenue and an important source of local tax revenue, but decades of base erosion threaten the tax’s share of overall revenue and have prompted years of countervailing rate increases.

ARPA’s Tax Mandate Ruled Unconstitutional by Appellate Court

The Fifth Circuit has affirmed states’ authority over their respective tax policies and has asserted that the offset clause—often called the “Tax Mandate”—of the American Rescue Plan Act (ARPA) has enough fiscal impact on a state’s budget so as to be coercive, as opposed to incentivizing.

Supreme Court Rules against Moores 7-2, Leaves Most Questions Undecided

The government won in Moore. However, given the narrow opinion of the court and the reasoning in the Barrett concurrence and the Thomas dissent, it seems likely that future rulings under other facts and circumstances could favor taxpayers instead.

Why We’re Closely Watching Moore v. U.S.

The Moore case could have important impacts on tax policy.

Economic Nexus Treatment by State, 2024

Reforming economic nexus thresholds would not only be better for businesses but for states as well. It is more cost-effective for states to focus on—and simplify—compliance for a reasonable number of sellers than to impose rules that have low compliance and are costly to administer. 

Why Moore v. U.S. Won’t Get Us a Consumption Tax Base

At first glance, a ruling for the plaintiffs in Moore might seem to solve some of the timing problems with the U.S. tax system. Unfortunately, upon greater inspection, such a ruling might create new timing problems. And the more rigid the ruling, the harder it would be to fix the timing problems it would create.

Marketplace Facilitator Laws: Past, Present, and a Better Future

The current patchwork of state laws taxing marketplace facilitators is complex, burdensome, and inefficient. States should work to resolve these issues and standardize the otherwise disparate requirements—with or without an inducement from Congress or the courts.

California Is Trying to Redefine “Tax Rebates” in a Threat to Public-Private Partnerships

Recharacterizing a rather simple repayment transaction as a tax rebate is concerning, not just for sound tax policy, but also for the future of public-private financing partnerships.

How the Moore Supreme Court Case Could Reshape Taxation of Unrealized Income

A major case pending before the U.S. Supreme Court (Moore v. United States) is calling into question provisions on large portions of the U.S. tax base which could quickly become legally uncertain, putting significant revenue at stake.

Washington Supreme Court Affirms Capital Gains Tax and Invites Challenge to Broader Income Tax Restrictions

The Washington Supreme Court not only gave its blessing to a capital gains tax that runs afoul of the state constitution, but it also set out a welcome mat for legislators eager to implement a broader income tax.

Joint Committee on Taxation (JCT)

Maryland’s Digital Advertising Tax Is Unworkably Vague

In addition to its economic impact on Maryland businesses and the likelihood of serious legal challenges, Maryland’s proposed digital advertising tax is incredibly vague on vital definitions, creating uncertainty about where revenue is sourced and when it is subject to the tax.

Confusion Reigns as Kansas Revenue Department, Attorney General Dispute the State’s New Online Sales Tax Regime

Kansas Invites Legal Challenge with Aggressive Remote Sales Tax Regime

Nevada Legislators and Businesses File Lawsuit Challenging Tax Increases

The Nevada constitution protects taxpayers by making it more difficult for legislators to raise public revenue. The Nevada courts should uphold this protection not just in theory but also in practice.

Washington State Judge Opens the Door for Income Taxes

North Carolina Judge Strikes Down Income Tax Cap Constitutional Amendment

Unclear if Warren’s Wealth Tax Proposal is Constitutional

There is a chance that Senator Warren’s proposed wealth tax would be found unconstitutional, but opinions are mixed and the precedents go both ways.