Debt limits are provisions that limit a state’s ability to take on new debt or debt service. This fact sheet describes the different rules that states use to limit debt and reviews evidence on how debt limits affect fiscal outcomes.
States use different methods to estimate how much revenue they will have available to spend in future years. This fact sheet describes different approaches to revenue forecasting and presents recommendations on how to improve forecasting accuracy and transparency.
Fluctuations in state revenue, especially unexpected ones, can compromise state services and contribute to overall fiscal instability. This fact sheet discusses the causes of state revenue volatility and how state tax and budget policy can either contribute to, or mitigate, it.
Supermajority budget rules require a state to obtain more than a majority vote of the legislature, typically two-thirds or three-fifths of the votes, to pass a budget bill. This fact sheet reviews evidence on how supermajority budget rules affect fiscal outcomes, such as late budgets and...
Tax and expenditure limits (TELs) are self-imposed restrictions that state governments create to restrict the amount they can tax or spend. This fact sheet describes how TELs vary across states and discusses evidence on whether TELs achieve their objective of restraining government growth.
States adopt a variety of budget practices to help define spending priorities and influence fiscal outcomes. However, not all budget practices achieve the desired fiscal objectives, and some practices may compromise states’ long-term fiscal sustainability. This report discusses evidence from the...
The Tax Cuts and Jobs Act (TCJA) would reduce tax revenue by nearly $1.5 trillion over the 10-year budget window from FY2018 to FY2027. Analysis by the Tax Policy Center shows that the tax cuts would tilt heavily toward the highest fifth of the income distribution, largely the result of cuts to...
In our research, we examine two alcohol excise tax increases enacted by Illinois in 1999 and in 2009. Using the synthetic control method, we find no evidence that either tax increase reduces fatal alcohol-related motor vehicle crashes for the whole of Illinois, although we do find evidence of a...
The Tax Policy Center has released distributional estimates of the Senate version of the Tax Cuts and Jobs Act as passed by the Senate Finance Committee on November 16, 2017. We find the bill would reduce taxes on average for all income groups in both 2019 and 2025. In general, higher income...
The Tax Policy Center has released an analysis of the macroeconomic effects of the Tax Cuts and Jobs Act as passed by the US House of Representatives on November 16, 2017. We find the legislation would boost US economic output by 0.6 percent of gross domestic product (GDP) in 2018, 0.3 percent...
Debt Limits
Debt limits are provisions that limit a state’s ability to take on new debt or debt service. This fact sheet describes the different rules that states use to limit debt and reviews evidence on how debt limits affect fiscal outcomes.
Revenue Forecasting Practices
States use different methods to estimate how much revenue they will have available to spend in future years. This fact sheet describes different approaches to revenue forecasting and presents recommendations on how to improve forecasting accuracy and transparency.
Revenue Volatility
Fluctuations in state revenue, especially unexpected ones, can compromise state services and contribute to overall fiscal instability. This fact sheet discusses the causes of state revenue volatility and how state tax and budget policy can either contribute to, or mitigate, it.
Supermajority Budget and Tax Rules
Supermajority budget rules require a state to obtain more than a majority vote of the legislature, typically two-thirds or three-fifths of the votes, to pass a budget bill. This fact sheet reviews evidence on how supermajority budget rules affect fiscal outcomes, such as late budgets and...
Tax and Expenditure Limits
Tax and expenditure limits (TELs) are self-imposed restrictions that state governments create to restrict the amount they can tax or spend. This fact sheet describes how TELs vary across states and discusses evidence on whether TELs achieve their objective of restraining government growth.
Sustainable Budgeting in the States: Evidence on State Budget Institutions and Practices
States adopt a variety of budget practices to help define spending priorities and influence fiscal outcomes. However, not all budget practices achieve the desired fiscal objectives, and some practices may compromise states’ long-term fiscal sustainability. This report discusses evidence from the...
Impact of the Tax Cuts and Jobs Act on Families with Young Children
The Tax Cuts and Jobs Act (TCJA) would reduce tax revenue by nearly $1.5 trillion over the 10-year budget window from FY2018 to FY2027. Analysis by the Tax Policy Center shows that the tax cuts would tilt heavily toward the highest fifth of the income distribution, largely the result of cuts to...
State Alcohol Excise Taxes May Have Little Effect on Drunk Driving Fatalities
In our research, we examine two alcohol excise tax increases enacted by Illinois in 1999 and in 2009. Using the synthetic control method, we find no evidence that either tax increase reduces fatal alcohol-related motor vehicle crashes for the whole of Illinois, although we do find evidence of a...
Distributional Analysis of the Tax Cuts and Jobs Act as Passed by the Senate Finance Committee
The Tax Policy Center has released distributional estimates of the Senate version of the Tax Cuts and Jobs Act as passed by the Senate Finance Committee on November 16, 2017. We find the bill would reduce taxes on average for all income groups in both 2019 and 2025. In general, higher income...
Macroeconomic Analysis of the Tax Cuts and Jobs Act as Passed by the House of Representatives
The Tax Policy Center has released an analysis of the macroeconomic effects of the Tax Cuts and Jobs Act as passed by the US House of Representatives on November 16, 2017. We find the legislation would boost US economic output by 0.6 percent of gross domestic product (GDP) in 2018, 0.3 percent...