Tag: state taxes

To What Extent Does Your State Rely on Individual Income Taxes?

Mary Pat Campbell
To What Extent Does Your State Rely on Individual Income Taxes?

Graphic:

Excerpt:

Sources of state revenue have come under closer scrutiny in light of the impact of the coronavirus pandemic, as different tax types have differing volatility and economic impact—although even beyond these unique circumstances, it is important for policymakers to understand the trade-offs associated with different sources of tax revenue. This week’s map looks at what percentage of each state’s state and local tax collections is attributable to the individual income tax.

State and localities rely heavily on the individual income tax, which accounted for 24.2 percent of total U.S. state and local tax collections in fiscal year 2018, the latest year for which data are available. The individual income tax ranks just above the general sales tax (23.3 percent) and behind property taxes (31.1 percent), taking its place as the second largest source of state and local revenue.

Author(s): Janelle Cammenga

Publication Date: 10 February 2021

Publication Site: Tax Foundation

Connecticut Democrats Push Governor to Raise Taxes

Mary Pat Campbell

Link: https://www.wsj.com/articles/connecticut-democrats-push-governor-to-raise-taxes-11612717200

Excerpt:

A group of progressive Democratic lawmakers last week called on the governor, also a Democrat, to declare a fiscal emergency, and proposed a $3 billion legislative package of new spending on education, property-tax relief, a one-time stimulus payment of $500 for people who lost their jobs during the pandemic, and other measures.

Lawmakers proposed paying for these new spending items by raising taxes on the wealthy and on corporations to produce more than $4 billion in new revenue annually. The proposal includes establishing a 5% surtax on capital gains for individuals making more than $500,000 annually and raising the state’s top income-tax bracket to 12.696%, the second highest in the nation after California.

Author(s): Joseph De Avila

Publication Date: 7 February 2021

Publication Site: Wall Street Journal

Covid-19’s Hit to State and Local Revenues Is Smaller Than Many Feared

Mary Pat Campbell

Link: https://www.wsj.com/articles/covid-19s-hit-to-state-and-local-revenues-is-smaller-than-many-feared-11612706030

Excerpt:

Immediately after the coronavirus outbreak last March, states slashed revenue projections by an average of about 8%, with some expecting shortfalls as high as 20%. Those projections were largely based on experiences during the 2007-09 recession.

In the end, state revenues fell 1.6% in fiscal year 2020 and were 3.4% lower than projected before the pandemic, according to the National Association of State Budget Officers. While states expect revenues to decline 4.4% in fiscal 2021, 18 states are seeing revenues come in above forecast.

Author(s): Kate Davidson

Publication Date: 7 February 2021

Publication Site: Wall Street Journal

States Are Finally Going Bold with Progressive Tax Efforts

Mary Pat Campbell
States Are Finally Going Bold with Progressive Tax Efforts

Excerpt:

As the COVID-19 pandemic began, and again as 2020 drew to a close, we repeated our hope that these trying times would awaken and embolden state leaders to enact lasting solutions to emergent and long-standing needs in their states. Lawmakers in New Jersey and voters in Arizona helped set an example by taking progressive action in 2020.

…..

Thought leaders in Connecticut are making waves with progressive revenue solutions of their own. Connecticut Voices for Children released a major report in December, highlighting several tax policy options with the potential to “ensure that Connecticut’s tax system works to advance economic justice rather than continue to contribute to economic injustice.” Those options include: income tax increases on households with incomes over $500,000 ($1 million for couples) that could raise $504 million to $1.72 billion per year; estate tax improvements to reverse cuts and raise $108-162 million per year; a surcharge on capital gains and other similar income to raise $167-334 million per year; and a mansion tax on homes valued over $1.5 million that could raise $331-663 million. These ideas are already being reflected in bills to be considered by lawmakers this year.

Author(s): Dylan Grundman O’Neill

Publication Date: 4 February 2021

Publication Site: Institute on Taxation and Economic Policy

Cuomo’s Tax Ultimatum

Mary Pat Campbell

Link: https://www.wsj.com/articles/cuomos-tax-ultimatum-11611359134?mod=opinion_lead_pos4

Excerpt:

Viewers of Andrew Cuomo’s Emmy-award winning Covid-19 briefings may have noticed how the New York Governor has become increasingly excitable. In this week’s budget show, he pointed an economic gun at New York and threatened to shoot if Washington doesn’t fork over $15 billion.

“If the federal government doesn’t fund state and local governments, it’s going to hurt all New Yorkers,” Mr. Cuomo warned Tuesday while proposing to raise the state’s top income tax rate in New York City to 14.7%. This would be the highest rate in the country, at least until New Jersey Gov. Phil Murphy makes a competing bid.

Publication Date: 22 January 2021

Publication Site: WSJ

Homeowners in these 10 towns would pay the most under a proposed Connecticut ‘mansion tax’

Mary Pat Campbell

Link: https://www.courant.com/politics/hc-pol-mansion-tax-towns-20210127-vn3vkw7hfrg6lngynndiwe5kzi-story.html

Excerpt:

A proposed statewide property tax on homes valued at $430,000 or higher would be largely paid by homeowners along Connecticut’s Gold Coast, with Greenwich accounting for more than 25% of all the new revenue, according to legislative estimates.

But the analysis prepared by legislative staff shows that some homeowners in smaller or less well-heeled towns like Manchester or Putnam, would also be on the hook for the new fee, though contributing far less to the estimated $75 million that would be raised annually than their Fairfield County counterparts.

Author: Russell Blair

Publication Date:

Publication Site: Hartford Courant