State Rundown 9/19: Income Tax Debates and Film Tax Credits


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State income taxes are a political issue in Massachusetts and Tennessee; Louisiana and California have film tax credits on the agenda

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House GOP Bill Combines Worst Tax Break Ideas of 2014 for Half-a-Trillion Dollar Giveaway


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With very few days left to legislate before the election, House Republicans are rushing through the Jobs for America Act, which includes several provisions to curb regulations as well as a grab bag of over $520 billion in tax breaks for businesses over the next decade. These tax cuts will do more to expand the deficit than expand employment.

The House already approved each of these tax breaks as separate pieces of legislation that went nowhere in the Senate. The first three of the breaks described below are usually temporarily extended as part of the "tax extenders" legislation that Congress usually enacts every couple of years. Making these breaks permanent, as this House bill would do, would destroy any hope that lawmakers will ever come to their senses and end this wasteful practice.

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New Proposals from Congressman Pocan and CTJ to Stop Corporate Inversions


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The crisis of corporate inversions remains unresolved in Congress, but some new proposals could set the stage for a resolution.

Part of the problem could be addressed with a new proposal from Rep. Mark Pocan of Wisconsin, while another can be addressed with a proposal described by Citizens for Tax Justice and Americans for Tax Fairness in a recent op-ed.

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What's the Matter with Kansas Is What Ails All 50 States


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It's easy to hold up Kansas as the poster child for regressive tax policies gone awry.

By now it's apparent Gov. Sam Brownback and his allies in the state legislature were wrong when they predicted lopsided tax cuts would boost the state's economy. The state will have trouble funding priorities such as education and services for the disabled since its revenue is hundreds of millions less than projected. And just last month, Standard & Poor's downgraded the state's bond rating because Brownback's tax cuts cost far more than promised.

But make no mistake. The tax cuts, which disproportionately benefited higher-income earners and corporations, made worse an already regressive tax code. And in that sense, Kansas is not alone. When all taxes assessed by state and local governments are taken into account, every state imposes higher effective tax rates on low-income families than the richest tax payers

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Tax Policy and the Race for the Governor's Mansion: Massachusetts Edition


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Massachusetts voters will choose between Martha Coakley and Charlie Baker in the upcoming gubernatorial election. Education spending and the gas tax will be big issues in this campaign.

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Will the OECD's Recommendations to Stop Corporate Tax Dodging Actually Work?


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On September 16, the Organization for Economic Cooperation and Development (OECD) released the first part of its recommendations to implement its 2013 "Action Plan on Base Erosion and Profit Shifting." Base erosion and profit shifting, or BEPS as it's known among international tax experts, is the fancy way of describing tax dodging by corporations that use offshore tax havens. CTJ criticized the action plan in 2013 for not going far enough, and it remains to be seen how much good can be accomplished with the reforms that OECD now recommends.

At the same time, the OECD recommendations are surely a step in the right direction. This is important because many members of Congress, including the top Republicans on the House and Senate committees with jurisdiction over taxes, consider even the OECD's mild reforms to be asking too much of corporations.

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State Rundown 9/17: Virginia Gas Tax, Tesla's Sweetheart Deal


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Virginia gas taxes could rise if Congress doesn't pass internet sales tax legislation; the political showdown in Kansas continues; Wallet Hub backs up ITEP's findings; Tesla Motors gets sweetheart economic development deal from Nevada

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Poverty Data Not Surprising, No Matter How You Spin It


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The top 20 percent of households captured more of the nation's collective income (51 percent) than the rest of population, according to the Census report Income and Poverty in the United States: 2013 released today.

This is consistent with what we know about deepening income inequality in this nation. Median household income remained relatively stagnant in 2013 at $51,939, a mere $180 more than the previous year, giving the average family no more buying power than they had the year before and 8 percent less than they did in 2007, just before the throes of the economic recession.

This is consistent with what working people all over the nation are saying: They work harder and harder, but they can't get ahead.

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New S&P Report Helps Make the Case for Progressive State Taxes


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The latest report from Standard & Poor's Rating Services reminds us that progressive tax reform can help mitigate income inequality and ensure states have enough revenue to fund their basic needs.

As has been documented by everyone from the Federal Reserve Board to Thomas Piketty, the share of income and wealth accruing to the very best-off Americans has grown substantially over the past century. The problem worsened in the years immediately following the financial crisis. This trend raises important philosophical questions about whether low-income Americans really have the same opportunities to share in the American dream that the wealthiest have been granted.

But Standard & Poor's new report finds that there's also a more mundane, practical reason to be concerned about inequality: it can make it harder and harder for state tax systems to pay for needed services over time. The more income that goes to the wealthy, the slower a state's revenue grows. Digging deeper, S&P also found that not all states have been affected in the same way by rising inequality. States relying heavily on sales taxes tend to be hardest hit by growing income inequality, while states relying heavily on personal income don't see the same negative impact.

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Tax Policy and the Race for the Governor's Mansion: Ohio Edition


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Current Ohio Governor (and former Congressman) John Kasich (R) is running for reelection against Cuyahoga County Executive Ed Fitzgerald (D). Fitzgerald's stand on economic issues is promising, in terms of taxes he's said "that the wealthy should pay their fair share." It would be hard to find a sitting governor who has done more to ensure the opposite than Gov. Kasich.

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