CTJ's Tax Justice Digest, April 21, 2006Welcome to CTJ's Tax Justice Digest, our regular survey of new and interesting trends in state and federal tax policy. Click here to browse through archived editions of the Digest. |
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Tax Day is safely behind us-- and our elected officials have once again done quite well for themselves. A new CTJ report shows that President Bush got a $26,000 tax break from his own tax cuts in 2005, while Vice-President Cheney saved over $1 million. CTJ's analysis shows that a new temporary tax break, ostensibly designed for hurricane relief, allowed Cheney to write off an additional $2.5 million in charitable donations for non-hurricane-related organizations.
In Oregon, the Oregonian does a terrific job explaining the state's long-term shift from taxing corporations to taxing working families, and recommends sensible reforms such as increasing the state's corporate minimum tax. The Oregon Center for Public Policy (OCPP), which has documented this worrisome tax shift in a series of reports, has a detailed analysis here. Meanwhile, in the most exciting news for corporate tax disclosure so far this year, signatures are being gathered for a November ballot initiative that would require big corporations doing business in Oregon to disclose basic information about their effective tax rates. Check out the OCPP's information page here.
Also in Oregon, Governor Ted Kulongoski (a Democrat) seems to think that the state's progressive income tax is to blame for Oregon's chronic fiscal woes--and that enacting a sales tax could help stabilize state revenues. But the real culprit is the state's lack of an effective rainy-day fund.
As we reported in last week's digest, elected officials are doing all they can to wiggle around and out of their "no new tax" pledges. This week we have a similar story from Kentucky, where Governor Ernie Fletcher explains his support for a 25 cent tax on cigarette papers by calling it "closing a loophole" rather than an actual tax hike. Even the House Speaker seems confused, claiming that this proposal is "not a tax increase, it's tax equity." For a heavy hitting editorial from the Courier-Journal about this attempt to raise taxes, but stay away from the "T" word, click here.
As a result of Alabama's recently enacted income tax relief legislation, Hawaii's income tax now has the dubious distinction of taxing poverty level working families more heavily than any other state income tax. This is hardly a statistic that makes many residents of the Aloha state very pleased. Meanwhile advocates in New Mexico remind us that even states that exempt families living in poverty from the income tax could do more to assist families just trying to get by. To see how your state taxes families living in poverty check out this Center on Budget and Policy Priorities report.
Dependent care expenses are a growing financial burden for working families, and many states have enacted targeted income tax breaks designed to reduce that burden. A new report from the National Women's Law Center provides a detailed survey of dependent care tax breaks, identifies "best practices" for states using these tax breaks and includes a state-by-state report card on the effectiveness of state dependent care tax provisions. Find out if your state is among the fourteen that received failing grades from NWLC here. Earlier this month, Georgia became the latest state to enact a dependent care credit. The Georgia Budget and Policy Institute evaluates the bill here.
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