Ridgewood NJ, with Tax Day looming and 81% of people being more worried about inflation than taxes this year, WalletHub today released its 2023 Taxpayer Survey, as well as its yearly report on the States with the Highest & Lowest Tax Rates, in order to help people better understand this confusing time of year. You can find highlights from both below, followed by the full list of WalletHub’s 2023 taxpayer resources.
ATLANTIC CITY, N.J. (AP) – State voters are being promised that millions of dollars in new funding will flow to programs for senior citizens and the horse racing industry and to help a struggling Atlantic City if they approve a ballot question authorizing two new casinos near New York City. But what they’re not being told is what tax rate the new casinos in the northern part of the state would pay or how much new money would be available.
On Tuesday, a state lawmaker proposed specific tax rates for the new gambling halls. Assemblyman Ralph Caputo told The Associated Press a casino at the Meadowlands Racetrack might be taxed at 35 to 40 percent while a costlier one in Jersey City could pay 15 to 20 percent.
“We’ve lagged behind in terms of being transparent,” said Caputo, a northern New Jersey Democrat and former casino worker. “There’s no use kidding anybody about that. The tax rate needs to be established.”
The proposal came as pro- and anti-casino expansion forces are pouring millions of dollars into ads in the nation’s most expensive media market to influence the outcome of the November referendum.
News outlets are running stories about the rise in corporate tax inversions. Inversions are financial reorganizations that place U.S. firms under foreign parent corporations. They are one of the many ways that companies are responding to America’s uniquely high corporate tax rate.
Liberal policymakers and pundits are outraged by inversions because they fear that the government will be starved of revenues. Treasury Secretary Jacob Lew has demanded new rules to stop inversions because “allowing these transactions to continue, we run the risk of eroding our corporate tax base and undoing the progress we have made to reduce our budget deficits.”
However, it is our high 40 percent tax rate that is eroding our corporate tax base. If we chopped the rate substantially, tax avoidance would fall and U.S. investment would rise. Over time, more income would be reported to the government, with the result that the government would probably not lose any money, and it could even gain some. Governments, businesses, and workers would all win from a corporate tax rate cut.
Here is some evidence that the government would win. For 19 OECD countries for which there is good data back to the 1960s, I plotted the average corporate tax rates and average corporate tax revenues. The chart illustrates the Laffer effect of cutting high statutory tax rates on a very mobile tax base.
