Tax Reductions mean any tax refund (including associated interest received from the relevant Governmental Entity) or any Tax credit or deduction resulting in an actual reduction in cash Taxes paid by the Buyer, the Company, any of their Subsidiaries, or their Affiliates. This article discusses fifty percent of States that are advocating for Tax Reductions or Tax Elimination. Many regional states have financial reserves, or “rainy day funds,” while the federal government is struggling with a debt ceiling dilemma. As a result, 27 states are currently thinking about reducing (or doing away with) their taxes.
According to the National Association of State Budget Officers (Photo: Al Goldis – Shutterstock.com)
The National Association of State Budget Officers reports that states have seen widespread budget surpluses for the past two years, thanks in large part to “recent state policy moves to build their reserves,” including billions in federal assistance as a result of the pandemic. Reserves stood at $70 billion in 2020; by 2023, they are anticipated to nearly treble to $136 billion.
The Institute on Taxation and Economic Policy (ITEP) claimed that many states are currently experiencing “tax cut fever” and are considering offering property tax cuts and rebate checks, lowering income tax rates, and in the cases of Mississippi and Arkansas, eliminating state income taxes.
The decision was made, according to state lawmakers, for a variety of reasons, including “to increase economic growth, make their states more competitive with other states economically, or help taxpayers who are dealing with inflation,” as reported by CBS. Lack of state taxes would benefit states like Mississippi and Arkansas in particular by luring new firms and residents.
Some experts, though, aren’t sure who the tax cuts would help because most of the benefits would go to the highest earners in the 27 states, while low- and middle-income families still have trouble making ends meet. Some analysts also told CBS that the timing is worrying. Even though states have budget surpluses right now, what happens if the U.S. goes into a full-blown recession?
CBS lists the 27 states that agreed about tax reductions and want to cut taxes:
CBS lists the 27 states that agreed about tax reductions and want to cut taxes:
Arkansas: the state’s income tax on individuals is completely gone.
Colorado will get a tax break of $200 million.
Connecticut is lowering the amount of tax owed by each person.
Georgia will get $1 billion to help with the cost of living and another $1 billion to help with property taxes.
Idaho is getting a tax break of $120 million.
Indiana is lowering the amount of taxes people have to pay and cutting property taxes.
Iowa has a flat tax rate of 3.9% on income and lower taxes on the property.
Kansas could have either a flat tax rate on income or lower sales taxes and less income tax on Social Security.
The flat income tax in Kentucky is going down from 5% to 4% by next year.
Louisiana has made changes to its property and sales taxes and has thought about getting rid of its income tax.
Michigan will give everyone who files taxes in the state a $180 tax rebate, get rid of a retirement tax, and increase their matching of the federal Earned Income Tax Credit.
Minnesota is getting rid of the tax on Social Security.
Mississippi: Getting rid of the state’s income tax on individuals. supports for tax reductions and tax eliminations
Missouri is cutting income taxes, sales taxes, and taxes on the property.
Montana residents will get tax rebate checks for $1,250 or more, and homeowners will get checks for $500.
Nebraska: lowering income tax rates and not taxing any income from Social Security.
New Mexico residents will get tax checks for $750.
North Carolina is lowering the rate at which people pay income tax.
North Dakota is getting rid of all income taxes for people with low and middle incomes.
Ohio is switching from a graduated income tax to a flat tax.
Oklahoma: lowering state taxes on groceries and income taxes for individuals.
South Carolina is moving quickly to make changes to tax brackets and tax cuts that lower the rate owed.
Utah residents will get tax rebate checks of $100 or more and the income tax rate will go down.
Vermont is getting rid of the tax on veteran pensions and giving Social Security more tax breaks.
Virginia is cutting tax rates for individuals. Approve for tax reductions and tax eliminations
West Virginia is lowering taxes on individuals by 50 percent over the next three years.
Wisconsin should either switch to a flat tax rate or lower taxes for people in the middle class. agreed for tax reductions and tax eliminations
Read More: Ohio Child Tax Credit Expansion An Asset; Here’s Why
