This essay reports revised estimates for the tax cannibalization problem with respect to U.S. state-level corporate income taxes. The essay concludes that, although the tax cannibalization generated by state corporate income taxes has been substantially reduced since 2017, the magnitude of the...

The Tax Cut and Jobs Act (TCJA) was the most significant piece of federal tax legislation passed in thirty years. Not surprisingly, the TCJA has spurred the states to rethink their tax systems. This rethinking of state taxes was necessary even before the TCJA. To date, the states have primarily...

States and localities offer businesses an enormous amount of tax incentives to locate within their jurisdictions despite: 1) the mass of evidence that suggests that these incentives are not particularly effective and, 2) substantial doubts about their constitutionality. In this essay, we develop...

This essay evaluates the limits on the U.S. federal government's powers to restrict the taxing powers of state governments. The essay revisits earlier debates on this question, to consider the implications of the Supreme Court's decision in National Federation of Independent Business v. Sebelius...

This is the second of a series of essays wherein we analyze the U.S. Supreme Court's decision in South Dakota v. Wayfair. In this essay, we address issues related to sales tax formalism and income tax nexus

Governments at all levels – federal, state and local – are suffering through ever more severe budget crises. The interests of these different levels of government are often assumed to be in conflict. For instance, it seems reasonable to believe that if the federal government were to get its...

The state corporate income tax has been and remains a vital source of income for the states. The theoretical justifications for this tax, however, are weak and, as reasonably predicted based on its poor design, the state corporate income tax has been in decline as a source of state revenue for...

This essay explains some of the implementation details and options for how states might go about expanding their sales tax bases to include services as a response to the fiscal challenges of the COVID-19 crisis