August 23rd, 2010
02:10 PM ET
4 years ago

State tax hikes could go too far

New York (CNNMoney.com) - Some U.S. states facing steep budget gaps have resorted to tax policies that could be harmful over the long term, a non-profit research group said Monday.

In a review of 2010 changes in state tax policy, the Tax Foundation said certain states have targeted tax increases on high-income earners, smokers and out-of-state business transactions. These taxes may be politically convenient, but the foundation said that relying too heavily on such sources can lead to problems over the long run.

"Relatively high taxes on high-income individuals, smokers and out-of-state business transactions can make a state less attractive and create more volatility in an already uncertain economic climate," said Joseph Henchman, director of state projects at the Tax Foundation.

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Filed under: issues • Taxes
soundoff (16 Responses)
  1. bennie new york

    I'm guessing that the Tax Foundation is a conservative demagogue organization. They haven't done a study the way the CBO would- they've simply branded an opinion as fact.

    August 23, 2010 02:17 pm at 2:17 pm |
  2. I can see November

    Duh. Raising taxes on the wealthy and vices is the Dems only plan.

    August 23, 2010 02:28 pm at 2:28 pm |
  3. Brian in MD

    Now only if our POTUS would understand this.

    August 23, 2010 02:31 pm at 2:31 pm |
  4. gt

    cut spending and entitlements....

    August 23, 2010 02:32 pm at 2:32 pm |
  5. jim

    Let the states that are in financial trouble get themselve out of the mess that they created.It is not up to the taxpayers in the rest of the country to come to their rescue.If their citizens have to pay higher taxes because of their failed policies than so be it.

    August 23, 2010 02:34 pm at 2:34 pm |
  6. Gar

    All of government, State, local and Federal need to stop trying to raise taxes.....CUT SPENDING!!!! Why can't they tighten their belts, cut spending on everything except education. Stop taxing the hardest working americans to give free stuff (food, housing, healthcare) to the laziest americans. Everyone on welfare, food stamps, unemployment and disability should have to do some kind of service in exchange for that money.

    August 23, 2010 02:37 pm at 2:37 pm |
  7. Chessnutz of Liverpool NY

    Hello... and Welcome to New York State now hand over your wallet. And this is a legal mugging from our own elected representatives.
    $11.00 for a pack of smokes that have a retail price of 0.75 cents? That is a tax of 681% on what is a legal product.
    So what happens people will go and buy them elsewhere, they cross over state lines to save over 60% or they buy on the reservations or online. Yet a NYS state senator with a budget for their office alone averages 2.6 Milloin a year? Yet our state leadership can not find ways to cut spending.

    August 23, 2010 02:44 pm at 2:44 pm |
  8. Claudia, Houston, Tx

    Governors are appointed to govern and in most States they lack thereof and pass the buck on to it's citizens. Governors have spent too much time and money wining and dining themselves and when a budget shortfall occurs they don't cut back they tax.

    August 23, 2010 02:52 pm at 2:52 pm |
  9. aneanderthal

    I'm sure a check will reveal that the states in worst shape are heavily dominated by unions in both the public and private sectors and we all know these greedy corrupt organizations could care less about the people and organzations they serve. They just bankrupt them and then cry on Obozos shoulder and he gives them everything they want. As far as corruption, remember that Blago wanted to become a union executive, That is the pinnacle for a corrupt, unethical person.

    August 23, 2010 02:54 pm at 2:54 pm |
  10. Pkm

    Im paying 9i dollars for car tags on a 92 toyato im poor i can hardly afford my tags

    August 23, 2010 02:54 pm at 2:54 pm |
  11. Pragmatic

    So we can't tax the rich ... because of the policy of "trickle down" ... we can't tax any company because they just raise their prices ... we can't tax smokers or soft drinks ....

    But, when it comes to cutting spending ... listen to the moans coming from N. Virginia as Gates tries to implement cutting Pentagon funding ... always "cut spending' and always "but not my program!"

    Think the GOP is really interested in "cutting spending"? . Republican Senators are insisting on more guarantees for a 10-YEAR BUDGET INCREASE to fix up the aging nuclear weapons complex.

    So we ""Can't tax" & "Can't cut" ... so what's next?

    August 23, 2010 02:55 pm at 2:55 pm |
  12. JonDie

    And who or what is the Tax Foundation, a lobby for rich people?

    August 23, 2010 02:57 pm at 2:57 pm |
  13. We voted for this?

    Easy fix to the economy: Cut unsustainable spending, change unsustainable policies, vote out democrats....

    Done.

    August 23, 2010 02:57 pm at 2:57 pm |
  14. Sniffit

    "a non-profit research group said Monday."

    Just remember..."non-profit" does not mean "objective" or "non-agenda."

    "states have targeted tax increases on high-income earners, smokers and out-of-state business transactions. These taxes may be politically convenient"

    Convenient? The only thing convenient about them is how convenient it is for the GOPers/conservatives to turn responsible tax policy into a demogoguery wedge issue to anger their mindless Limbot base.

    And notice how many "red" states with "red" legislatures and "red" governors and "red" citizenry are raising taxes. Hmmmmmmmm.

    August 23, 2010 03:05 pm at 3:05 pm |
  15. Bertina

    This makes as much sense as the tax cuts create jobs myth.

    August 23, 2010 03:32 pm at 3:32 pm |
  16. Bill in CA.

    That "whooshing" sound in CA is just that...businesses and people leaving in droves as the climate(business) has gotten absurd. Taxes and regs. run amok...and for what you ask??? Social handouts out of control and I don't have to tell you what party controls the legislature.

    August 23, 2010 03:38 pm at 3:38 pm |