Taxes

Most state tax changes take effect at the beginning of the calendar year (January 1) or at the beginning of the fiscal year (July 1 for most states). On January 1, 2023, thirty-eight states have noteworthy tax changes taking effect. Most of these changes represent net tax reductions, the result of an unprecedented wave of

This week, Congress forged an agreement to fund the federal government through an omnibus spending package that runs through September 2023. This package will include legislation that improves the tax treatment of saving, building on previous proposals introduced in the Senate and the House that change incentives to save and simplify the tax treatment of

Last week, the European Union approved the world’s first Carbon Border Adjustment Mechanism (CBAM). Well, in name anyway. The mechanism is a key aspect of the EU’s broader Fit for 55 package which aims to cut 55 percent of net greenhouse gas (GHG) emissions in the EU by 2030. It’s also a foundational aspect of

The tax treatment of charitable giving over the past few years has been influenced by two major tax events: the 2017 Tax Cuts and Jobs Act (TCJA) and the 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act. These changes provide a case study of how changes in tax policy can influence taxpayer behavior in

Key Findings A typical American household with four phones on a “family share” plan, paying $100 per month for taxable wireless service, would pay nearly $305 per year in taxes, fees, and government surcharges—up slightly from $300 in 2021. Nationally, taxes, fees, and government surcharges make up a record-high 25.4 percent tax on taxable voice

Underlying every fiscal policy discussion in Washington is the question of progressivity: how much should tax and spending policy redistribute from high-income households to low-income households? This debate is often more rhetorical than substantive, but a recent study by the Congressional Budget Office (CBO) fills this void by presenting data showing that the current fiscal

Research and development (R&D) is a crucial part of technological change, as R&D takes initial scientific discoveries and translates them into useful products that improve lives. Both the public and private sectors play important roles in R&D, but in recent years, private sector investment has become increasingly important. In 2019, businesses performed 75 percent of

Key Findings In 2022, 16 countries made changes to their statutory corporate income tax rates. Six countries—Colombia, South Sudan, Netherlands, Turkey, Chile, and Montenegro—increased their top corporate tax rates, while 10 countries—including France, Greece, and Monaco—reduced their corporate tax rates. Comoros (50 percent), Puerto Rico (37.5 percent), and Suriname (36 percent) are the jurisdictions with the

Key Findings Central administration of local taxes is a common feature of sales taxes but is less common for income, tourism, and other local taxes. Absent centralized administration, localities increase their administrative costs, impose substantial additional compliance costs on businesses, and reduce overall levels of compliance. A patchwork approach to local tax administration is particularly

As part of the 2017 Tax Cuts and Jobs Act (TCJA), the United States enacted a new limitation on interest deductions for businesses. While it is common for countries across the Organization for Economic Cooperation and Development (OECD) to set limits for interest deductions, starting this year, the U.S. became an outlier by using earnings

The Tax Foundation recently released the 2022 International Tax Competitiveness Index (ITCI), measuring the complexity and neutrality of countries’ tax systems. Over the years, Chile has consistently remained in the lower half of the Index’s rankings, and in the 2022 version of the Index, Chile fell from 26th to 27th (out of 38 countries) due

The tax treatment of research and development (R&D) expenses is one of the biggest issues facing Congress as the year winds down. Since the beginning of 2022, companies have had to spread deductions for R&D costs out over five years, instead of deducting them immediately. This policy, known as R&D amortization, reduces economic growth by