State Tax Actions 2016: Special Fiscal Report

State Tax Actions 2016 features state-by state-details about changes in tax laws enacted in 2016.
It includes analysis of the revenue impact and implications for future state tax policy,
illustrated with tables, charts and graphs.

Written for members of the states’ legislatures and professionals in public policy, political science and government affairs, State Tax Actions 2016 offers the facts with objective analysis and perspective.

Preface and Acknowledgments

State Tax Actions 2016 presents information about the tax and revenue changes enacted by state legislatures during the 2016 calendar year. It also contains the results of tax measures that were voted on during any 2016 elections and special sessions. In addition to aggregate state tax information, the report contains detailed information on 50 states. The reported changes generally take effect in fiscal year (FY) 2017. For 46 states, the fiscal year begins July 1 and ends June 30. Exceptions are Alabama and Michigan, where fiscal years begin in October and end in September; Texas, September to August; and New York, April to March.

This annual report is a cooperative effort of the National Association of Legislative Fiscal Offices (NALFO) and the National Conference of State Legislatures’ (NCSL) Fiscal Affairs Program. Without the advice, expertise and timely assistance of legislative fiscal staff from around the country, the report would not be possible.

Defining and Measuring Tax Changes

Organizations that measure state tax and revenue changes often report different numbers, resulting in confusion about the true magnitude of state tax increases or reductions.

Calculating state tax changes is complicated because there are two distinct ways changes may be counted.

One method—the “baseline” method—includes the effect of all statutory tax law changes adopted in the current legislative session. Under this method, only statutory tax law changes adopted in the 2016 legislative sessions are included.

The second method—the “taxpayer liability” method—measures the effect of tax changes on taxpayers and the economy, without regard to when statutory changes were adopted. Under this method, a state that makes a multi-year tax rate reduction would be credited with a tax reduction in each fiscal year during which the tax rate falls.

NCSL uses the taxpayer liability method, which excludes extensions of scheduled sunsets or other changes that are anticipated under current law because they pose no immediate tax change to the taxpayer.

Tax Highlights In 2016

Following the same trend as in 2015, this past year saw net reductions in personal and corporate income taxes and increases across most other tax categories. This is a result of a continued phase-in of major tax reduction packages passed during previous legislative sessions. Increases in sales and use, health, tobacco, and motor-fuel-related taxes led to a $2.3 billion revenue increase across all reporting states. Illinois did not enact a FY 2017 budget during the 2016 legislative session, and some states—such as Texas, Montana and Nevada, where the legislature only convenes biennially—did not have significant tax changes to report.

This report includes tax actions taken during regular and special legislative sessions in 2016, as well as actions approved by voters during the November 2016 general election. Fifty states provided information, which was obtained through a survey of the National Association of Legislative Fiscal Offices. Highlights include:

Chart shows net state tax changes by year of enactment 1995-2016

Louisiana and South Dakota experienced the largest tax increases in 2016 due to raising the sales and use tax in each state. Louisiana raised $1.5 billion in new revenue, or an increase of 16.4 percent. South Dakota experienced a net revenue increase of $107 million, or 6.4 percent of the total taxes collected in the previous year.

Indiana reported the largest tax decrease with a net reduction in revenues of 2.3 percent. This reduction is the result of phasing in personal and corporate income tax reductions that were originally enacted during the 2013 legislative session.

Sales and use and health-care-related taxes experienced the largest increases this year. This is primarily a result of Louisiana and South Dakota’s sales tax actions. Net increases in health care taxes are driven by California’s introduction of a tax on Managed Care Organization providers, which raised $1.1 billion in new revenue.

U.S. map shows 2016 net tax changes as a percentage of 2015 tax collections.

Additionally, states enacted tax changes that will have out-year revenue effects. New York reduced personal income taxes for middle-class taxpayers, which will lead to a revenue reduction of $4.2 billion when fully effective in 2026. California, Maine, Massachusetts and Nevada legalized recreational marijuana for persons 21 years and older during the 2016 general election. The regulatory structures still need to be developed in each state, but are expected to lead to additional out-year revenue generation.

Personal Income Taxes (net decrease: $884 million)

Seventeen states made net reductions to personal income taxes compared to six that raised them. Examples of personal income tax cuts include:

Table shows 2016 net tax changes by type of tax

Other states raised income taxes:

Corporation and Business Taxes (net decrease: $737 million)

Twenty states made reductions to corporate and business taxes in 2016, while five states experienced a net increase in this revenue category. Examples of business tax decreases include:

Five states raised corporate and business taxes:

Sales and Use Taxes (net increase: $789 million)

Fifteen states reduced sales and use taxes, while six states raised them. The $1.2 billion sales tax increase in Louisiana was the main driver behind the net revenue gain in this tax category.

Seven states raised sales taxes:

Health Care Provider and Industry Taxes (net increase: $1.35 billion)

Four states raised health care provider taxes, while one state reduced them. The $1.3 billion revenue increase was largely driven by the $1.1 billion tax increase in California. Actions include:

Tobacco Taxes (net increase: $1 billion)

Six states increased taxes on tobacco products in 2016:

Alcohol-Related Taxes (net increase: $18.2 million)

One state increased taxes and one state cut taxes on alcoholic beverages in 2016.

Motor Fuel Taxes (net increase: $923 million)

Three states increased motor fuel taxes. Actions include:

Miscellaneous Taxes (net decrease: $125 million)

Nine states enacted miscellaneous tax changes. Six states raised taxes and three states cut taxes for a net revenue decrease of $2.4 million.

Miscellaneous tax decreases include:

Examples of increases include:

Fees (net increase: $297 million)

In addition to taxes, 15 states relied on new fees and fee increases to help shore up revenues, while five states reduced them. For example:

Other Revenues (net increase: $129million; accelerations: -$49 million; other: +$178 million)

States also made nontax policy changes to impact FY 2017 revenue collections. Several states found new revenue through enhanced compliance efforts or tax amnesty programs.

Examples of accelerations and decelerations:

Tax changes in 2016 as a percentage of 2015 tax collections are listed in Appendix A. State changes by tax type are in Appendix B. Appendix C shows both tax and nontax revenue changes by state. Property tax actions are discussed in Appendix D. Tax changes by state are displayed in Appendix E and detailed changes by type of tax are presented in Appendix F.

 

Appendix A.2016 Tax Changes as a Percentage of 2015 Tax Collections

Jurisdiction

Net Tax Changes
(in millions of dollars)

Percent of 2015 Taxes

Alabama

-$15.0

-0.2%

Alaska

$0.0

0.0%

Arizona

-$21.6

-0.2%

Arkansas

$0.0

0.0%

California

$1,138.0

0.8%

Colorado

$0.0

0.0%

Connecticut

$0.0

0.0%

Delaware

-$8.2

-0.2%

Florida

-$28.0

-0.1%

Georgia

-$211.0

-1.1%

Hawaii

-$5.0

-0.1%

Idaho

-$28.7

-0.7%

Illinois

$0.0

0.0%

Indiana

-$406.3

-2.3%

Iowa

$1.7

0.0%

Kansas

$0.0

0.0%

Kentucky

$0.0

0.0%

Louisiana

$1,591.6

16.4%

Maine

$23.2

0.6%

Maryland

-$8.5

0.0%

Massachusetts

-$226.0

-0.8%

Michigan

-$96.2

-0.4%

Minnesota

-$23.6

-0.1%

Mississippi

-$84.0

-1.1%

Missouri

-$88.3

-0.7%

Montana

$2.8

0.1%

Nebraska

-$2.9

-0.1%

Nevada

$0.0

0.0%

New Hampshire

-$21.1

-0.8%

New Jersey

$554.4

1.8%

New Mexico

-$115.8

-1.9%

New York

-$118.0

-0.2%

North Carolina

-$123.6

-0.5%

North Dakota

-$7.5

-0.1%

Ohio

-$42.0

-0.1%

Oklahoma

$171.0

1.8%

Oregon

$13.4

0.1%

Pennsylvania

$633.3

1.8%

Rhode Island

-$10.6

-0.3%

South Carolina

-$19.7

-0.2%

South Dakota

$107.0

6.4%

Tennessee

-$33.8

-0.3%

Texas

$0.0

0.0%

Utah

-$3.8

-0.1%

Vermont

$5.0

0.2%

Virginia

$0.9

0.0%

Washington

-$1.9

0.0%

West Virginia

$73.6

1.3%

Wisconsin

-$228.6

-1.3%

Wyoming

$4.6

0.2%

Total

$2,340.8

0.3%

Source: National Conference of State Legislatures’ survey of legislative fiscal offices, 2016; and U.S. Census Bureau, 2016

Appendix B.2016 Tax Changes by Type of Tax (in millions of dollars)

Jurisdiction

Personal Income

Corporate Income

Sales & Use

Health Care

Tobacco

Alcoholic Beverage

Motor

Misc.

Total

Alabama

$0.0

-$15.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$15.0

Alaska

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Arizona

-$12.3

$0.0

-$9.3

$0.0

$0.0

$0.0

$0.0

$0.0

-$21.6

Arkansas

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

California

$0.0

-$90.0

-$30.0

$1,100.0

$368.0

$0.0

$0.0

-$210.0

$1,138.0

Colorado

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Connecticut

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Delaware

$0.0

-$8.2

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$8.2

Florida

$0.0

-$3.2

-$24.8

$0.0

$0.0

$0.0

$0.0

$0.0

-$25.6

Georgia

-$77.8

-$89.3

-$43.9

$0.0

$0.0

$0.0

$0.0

$0.0

-$211.0

Hawaii

-$5.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$5.0

Idaho

-$28.7

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$28.7

Illinois

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Indiana

-$212.8

-$199.9

$6.4

$0.0

$0.0

$0.0

$0.0

$0.0

-$406.3

Iowa

$23.0

$0.0

-$21.3

$0.0

$0.0

$0.0

$0.0

$0.0

$1.7

Kansas

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Kentucky

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Louisiana

$17.0

$84.6

$1,167.5

$244.0

$46.0

$19.2

$0.0

$13.3

$1,591.6

Maine

$30.7

-$6.7

-$0.8

$0.0

$0.0

$0.0

$0.0

$0.0

$23.2

Maryland

$0.0

-$7.5

-$1.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$8.5

Massachusetts

-$226.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$226.0

Michigan

$0.0

$80.0

-$380.9

$0.0

$0.0

$0.0

$204.7

$0.0

-$96.2

Minnesota

-$22.6

$0.0

-$1.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$23.6

Mississippi

$0.0

-$84.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$84.0

Missouri

-$88.3

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$88.3

Montana

$2.8

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$2.8

Nebraska

$0.0

$0.0

-$2.9

$0.0

$0.0

$0.0

$0.0

$0.0

-$2.9

Nevada

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

New Hampshire

$0.0

-$21.1

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$21.1

New Jersey

-$62.0

$0.0

-$82.4

$0.0

$0.0

$0.0

$714.8

-$16.0

$554.4

New Mexico

$0.0

-$115.8

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$115.8

New York

-$98.0

-$15.0

-$4.0

$0.0

$0.0

-$1.0

$0.0

$0.0

-$118.0

North Carolina

-$145.0

$0.0

$19.8

$0.0

$0.0

$0.0

$0.0

$1.6

-$123.6

North Dakota

$0.0

-$7.5

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$7.5

Ohio

$0.0

-$20.0

-$22.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$42.0

Oklahoma

$110.1

$9.1

$0.0

$0.0

$0.0

$0.0

$0.0

$51.8

$175.3

Oregon

-$1.8

$1.6

$0.0

$0.0

$0.0

$0.0

$0.0

$13.6

$13.4

Pennsylvania

$15.8

$0.0

$102.4

$0.0

$495.7

$0.0

$0.0

$19.4

$633.3

Rhode Island

-$9.0

-$1.6

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$10.6

South Carolina

-$17.8

$0.0

-$1.9

$0.0

$0.0

$0.0

$0.0

$0.0

-$19.7

South Dakota

$0.0

$0.0

$107.0

$0.0

$0.0

$0.0

$0.0

$0.0

$107.0

Tennessee

-29.7

-$4.1

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$33.8

Texas

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

Utah

$0.0

-$2.6

$0.0

$0.0

$0.0

$0.0

$0.0

-$1.2

-$3.8

Vermont

$0.0

$0.0

$0.0

$1.2

$0.0

$0.0

$3.8

$0.0

$5.0

Virginia

$0.0

$0.9

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$2.8

Washington

$0.0

-$1.9

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

-$1.9

West Virginia

-$14.0

-$27.0

$14.9

-$1.0

$98.5

$0.0

$0.0

$2.2

$73.6

Wisconsin

-$32.9

-$192.5

-$3.2

$0.0

$0.0

$0.0

$0.0

$0.0

-$228.6

Wyoming

$0.0

$0.0

$0.0

$4.6

$0.0

$0.0

$0.0

$0.0

$4.6

Total

-$884.3

-$736.7

$788.6

$1,348.8

$1,008.2

$18.2

$923.3

-$125.3

$2,340.8

Source: National Conference of State Legislatures’ survey of legislative fiscal offices, 2016

Appendix C.2016 Net Revenue Changes (in millions of dollars)

Jurisdiction

Taxes

Fees

Accelerations

Other

Total Revenue

Alabama

-$15.0

$0.0

$0.0

$0.0

-$15.0

Alaska

$0.0

$2.8

$0.0

$0.0

$2.8

Arizona

-$21.6

$0.0

-$2.4

$0.0

-$24.0

Arkansas

$0.0

$0.0

$0.0

$0.0

$0.0

California

$1,138.0

$3.6

$0.0

$0.0

$1,141.6

Colorado

$0.0

$4.2

$0.0

$0.0

$4.2

Connecticut

$0.0

-$4.5

$0.0

$0.0

-$4.5

Delaware

-$8.2

$0.0

$0.0

$0.0

-$8.2

Florida

-$25.6

-$3.2

-$13.7

$0.0

-$42.5

Georgia

-$211.0

$0.0

$0.0

$0.0

-$211.0

Hawaii

-$5.0

$0.0

$0.0

$0.0

-$5.0

Idaho

-$28.7

$2.9

$0.0

$0.0

-$25.8

Illinois

$0.0

$0.0

$0.0

$0.0

$0.0

Indiana

-$406.3

$0.0

$0.0

$0.0

-$406.3

Iowa

$1.7

$0.0

$0.0

$0.0

$1.7

Kansas

$0.0

$9.1

$0.0

$0.0

$9.1

Kentucky

$0.0

$1.0

$0.0

$0.0

$1.0

Louisiana

$1,591.6

$19.4

$0.0

$18.9

$1,629.9

Maine

$23.2

$0.0

$0.0

$0.0

$23.2

Maryland

-$8.5

-$3.6

$0.0

-$2.1

-$14.2

Massachusetts

-$226.0

$0.0

$0.0

$0.0

-$226.0

Michigan

-$96.2

$172.5

$0.0

$0.0

$76.3

Minnesota

-$23.6

$0.0

$0.0

$0.0

-$23.6

Mississippi

-$84.0

$0.0

$0.0

$0.0

-$84.0

Missouri

-$88.3

$0.0

$0.0

$0.0

-$88.3

Montana

$2.8

$0.0

$0.0

$0.0

$2.8

Nebraska

-$2.9

$0.0

$0.0

$0.0

-$2.9

Nevada

$0.0

$0.0

$0.0

$0.0

$0.0

New Hampshire

-$21.1

$0.0

$0.0

$0.0

-$21.1

New Jersey

$554.4

$0.0

$0.0

$0.0

$554.4

New Mexico

-$115.8

$0.0

$0.0

$0.0

-$115.8

New York

-$118.0

-$37.0

$0.0

$0.0

-$155.0

North Carolina

-$123.6

$0.0

$0.0

$0.0

-$123.6

North Dakota

-$7.5

$0.0

$0.0

$0.0

-$7.5

Ohio

-$42.0

$0.0

$0.0

$0.0

-$42.0

Oklahoma

$175.3

$13.0

$0.0

$46.6

$234.9

Oregon

$13.4

$0.0

$0.0

$0.0

$13.4

Pennsylvania

$633.3

$73.2

$0.0

$100.0

$806.5

Rhode Island

-$10.6

-$1.3

$0.0

$16.2

$4.3

South Carolina

-$19.7

$0.0

$0.0

$0.0

-$19.7

South Dakota

$107.0

$0.0

$0.0

$0.0

$107.0

Tennessee

-$33.8

$5.2

$0.0

-$4.9

-$33.5

Texas

$0.0

$0.0

$0.0

$0.0

$0.0

Utah

-$3.8

$0.0

$0.0

$0.0

-$3.8

Vermont

$5.0

$35.4

$3.8

$0.0

$44.2

Virginia

$2.8

$0.0

-$36.7

$3.6

-$30.3

Washington

-$1.9

$0.0

$0.0

$0.0

-$1.9

West Virginia

$73.6

$0.0

$0.0

$0.0

$73.6

Wisconsin

$0.0

$4.3

$0.0

$0.0

$0.0

Wyoming

$4.6

$0.0

$0.0

$0.0

$4.6

Total

$2,340.8

$297.0

-$49.0

$178.3

$2,767.1

Source: National Conference of State Legislatures’ survey of legislative fiscal offices, 2016

Appendix D.Property Tax Actions in 2016

Alabama amended its state constitution to give municipalities and counties increased discretion over the tax increment districts developed within a Major 21st Century Manufacturing Zone.

Florida enacted a value adjustment board interest rate reduction from 12 percent to the prime rate, resulting in a revenue gain of $5.7 million.

Florida approved two constitutional amendments during the 2016 general election. The first revised the homestead tax exemption that may be granted for certain senior, low-income, long-term residents to specify that just value is determined in the first tax year the owner applies and is eligible for the exemption. The state estimated a revenue reduction between $0.5 million and $1.6 million in FY 2017, depending on the number of municipalities to adopt the exemption.

The second amendment authorized a first responder disabled from injuries sustained in the line of duty to receive relief from ad valorem taxes assessed on homestead property. The local revenue impact is indeterminate.

Indiana enacted a farmland base valuation per-acre change. The total cost to the state is projected to be $1.7 million in FY 2017 and $7 million in FY 2018.

Kansas accelerated the effective date of property “tax-lid” from 2018 to 2017. This measure requires city and county governments to hold a public vote if they want to raise spending by more than the adjusted Consumer Price Index set by the state. It is now scheduled to take effect in the summer of 2017.

Louisiana approved an amendment to the state constitution during the 2016 general election authorizing an exemption from ad valorem property tax for the total assessed value of the homestead for a surviving partner of a member of the armed forces who died while on active duty or of a state police, law enforcement or fire protection officers who died while performing their duties.

Maryland adopted a property tax exemption for certain cranes located on state property, resulting in a revenue reduction of $2.2 million.

Michigan modified the treatment of certain property under the Essential Services Assessment. This adds provisions to address value of property where construction is in progress at half the acquisition cost. It also addresses property currently exempt under an industrial facilities certificate that will now fall under personal property exemptions. These modifications will result in a revenue reduction of $4.1 million.

Nebraska increased the property tax credit appropriation, resulting in revenue reduction of $20 million in FY 2018.

South Carolina enacted an additional five years of eligibility for a multiple lot discount in certain circumstances for undeveloped acreage in subdivision lots. This measure sunset on Dec. 31, 2016 and the cost to the state is expected to be $1.6 million in FY 2017.

The South Dakota Legislature reduced the property tax rate for the school district general fund levy. K-12 school property tax funding was revised. The cost to the state is $40 million in FY 2017, but was offset by a 0.5 increase in the state sales tax rate raising, $107 million in new revenue for teacher salaries.

Utah approved a constitutional amendment during the 2016 general election, allowing property leased by the state or a political subdivision of the state to be exempt from property tax. The amendment has no fiscal impact on state or local government revenue, but may result in a slight shift of the property tax burden to residential homes and businesses.

Vermont reduced the statewide property tax rates from $1.535 to $1.527 per $100 of assessed property value. This measure includes a base increase, raising $9.9 million in new revenue.

Virginia adopted a constitutional amendment during the 2016 general election, allowing a locality to exempt from taxation the real property of the surviving spouse of any law-enforcement officer, firefighter, search and rescue personnel, or emergency medical services personnel killed in the line of duty. The exemption from taxation would cease if the surviving spouse remarries. The Department of Taxation indicates the impact to local revenues is currently unknown.

Appendix A.2016 Tax and Revenue Changes by State

This appendix shows by state the tax and revenue changes that took place in 2016 regular and special legislative sessions—and in the November 2016, general election—that will affect state revenues in FY 2017 (for most states July 1, 2016 to June 30, 2017) and FY 2018 (for most states July 1, 2017 to June 30, 2018). Tax changes by major tax category appear in Appendix F.

“Tax Revenue” for each state reports the revenue effect of tax actions for the fiscal year.

“Revenue Total” reports the total amount of state revenue change. It combines revenue derived from tax actions with other revenue changes such as fee increases, accelerated and decelerated revenue collections, and other one-time changes.

Changes effective in a certain fiscal year as a result of legislation passed and reported in an earlier year are noted by ** and are not reflected in the totals. Recurring changes made for state policy reasons are not reflected in the totals. This appendix does not include changes in unemployment compensation.

 

The following abbreviations are used:

AGI = Adjusted Gross Income

IRC = Internal Revenue Code

ARRA = American Recovery and Reinvestment Act

LLC = Limited Liability Corporation

B&O = Business and Occupation

LLP = Limited Liability Partnership

CAT = Commercial Activity Tax

NOL = Net Operating Loss

CPI = Consumer Price Index

R&D = Research and Development

EITC = Earned Income Tax Credits

REIT = Real Estate Investment Trust

GRF = General Revenue Fund

HMO= Health Maintenance Organization

SSTP = Streamlined Sales Tax Project

TY = Tax Year

Appendix E. 2016 Tax and Revenue Changes by State

 

Revenue
FY 2017
 (in millions)

Revenue
FY 2018  
 (in millions)

Jurisdiction

Description

Alabama

Created an income tax credit for contributions to health savings accounts (-$2.7 million beginning in FY 2019).

$0.0

$0.0

 

Enacted a port tax credit for increased use of state port facilities capped at $5 million a year. The credit is not to exceed $12 million for the life of the program.

-$5.0

-$5.0

 

Created a Growing Alabama tax credit for cash donations to an approved local economic development organization. The credit is not to exceed 50 percent of current year tax liability of taxpayer (corporate and individual combined). The credit is set to expire on Sept. 30, 2020.

-$10.0

-$10.0

 

Adopted an apprenticeship tax credit of $1,000 for each apprentice employed. The credit is capped annually at $3 million (also applies to financial institution excise tax) and is set to expire on Dec. 31, 2021.

$0.0

-$3.0

 

Extended current assessment on private hospitals and changed the base year for calculating the assessment. (If the assessment was not extended, Medicaid would lose $257.5 million based on FY 2015 receipts.) Base year change from FY 2011 to FY 2014. The extension terminates on Sept. 30, 2017. No change in taxpayer liability.

$6.0**

$6.0**

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$15.0

-$18.0

 

Revenue Total=

-$15.0

-$18.0

Alaska

Modified various oil and gas tax credits.

$0.0

$15.0

 

Tax Revenue=

$0.0

$15.0

 

Increased hunting, fishing and trapping fees.

$2.7

$9.1

 

Enabled fees for Geologic Materials Center.

$0.1

$0.2

 

Non-Tax Revenue

$2.8

$9.3

 

Revenue Total=

$2.8

$24.3

Arizona

Increased the maximum amount claimed as a tax credit for contributions to charitable organizations.

-$2.6

$0.0

 

Extended due date to claim tax credit for contributions to charitable organizations until the 15th day of the fourth month following the close of the taxable year (which would be April 15 for most taxpayers).

-$1.7

$0.0

 

Increased the state individual income tax deduction from 10 percent to 100 percent of the amount allowed for federal bonus depreciation over two years.

-$8.0

-$8.0

 

Adopted a sales tax exemption on agricultural feed used in non-commercial boarding of livestock.

-$1.0

$0.0

 

Adopted a sales tax exemption on aircraft and aircraft equipment operated by charter airlines.

$0.0

-$2.3

 

Adopted a sales tax exemption on fine art purchased by nonresidents at an auction or a gallery in the state, for use outside the state.

-$1.3

$0.0

 

Modified the existing sales tax exemption on electricity and natural gas sold to manufacturers and smelters.

-$7.0

-$7.0

 

Tax Revenue=

-$21.6

-$17.3

 

Accelerated a previously enacted 0.3 percent gradual reduction of the insurance premium tax rate from 11 years to six years. The rate will change from 2 percent to 1.7 percent when fully phased in by 2021.

-$2.4

-$4.1

 

Established a Tax Amnesty Program that waives penalties and interest on unpaid individual income, corporate income and sales tax liabilities.  Taxpayers have the option to pay their taxes owed all at once in FY 2017, or over three years, from FY 2017 to FY 2019. The program is set to expire on Oct. 31, 2018.

N.A.

N.A.

 

Non-Tax Revenue=

-$2.4

-$4.1

 

 

Revenue Total=

-$24.0

-$21.4

Arkansas

No significant tax changes in 2016.

N.A.

N.A.

California

Reduced income-related taxes on certain health plans. Specified income excluded from gross income for purposes of corporate income taxation. This is part of state's Managed Care Organization (MCO) tax package, passed during special session in early 2016. This reduction is set to expire on June 30, 2019.

-$90.0

-$90.0

California, Continued

Enacted a tax on certain Managed Care Organization (MCO) providers. The tax consists of various taxing tiers and per enrollee amounts.  The net effect on revenue reflects the sum of gross tax revenue and a reduction for the amount paid back to MCOs through increased MediCal managed care payments. This is part of the MCO tax package and is set to expire on June 30, 2019.

$1,100.0

$1,700.0

 

Reduced income-related taxes on certain health plans. This change affects certain premium income of health plan related insurers. The tax rate has been reduced from 2.35 percent to 0 percent. This is part of the MCO tax package and is set to expire on June 30, 2019.

-$210.0

-$350.0

 

Enacted Proposition 56, which increased the cigarette tax by $2 per pack, with equivalent increases on other tobacco products and electronic cigarettes containing nicotine. This increase is expected to raise $1.4 billion in new revenue in FY 2018. Of this total, it is estimated that $24 million will come from taxes on electronic cigarettes.

$368.0

$1,400.0

 

Enacted Proposition 55, extending for 12 years the temporary personal income tax increases enacted in 2012 on earnings over $250,000 (for single filers; over $500,000 for joint filers; over $340,000 for heads of household). Extension will not take effect until tax year 2019. No change in taxpayer liability.

N.A.**

N.A.**

 

Enacted Proposition 64, exempting certain sales of medical marijuana from state sales tax.  Passed as part of Proposition 64 legalizing adult use of recreational marijuana.

-$30.0

$30.0

 

Enacted Proposition 64, legalizing recreational marijuana and hemp under state law. Designated state agencies to license and regulate marijuana industry. Imposed state excise tax on retail sales of marijuana equal to 15 percent of sales price, and state cultivation taxes on marijuana of $9.25 per ounce of flowers and $2.75 per ounce of leaves. Exempts medical marijuana from some taxation. This measure also allows for local regulation and taxation of marijuana. The legalization is estimated to raise $560 million in new revenue in FY 2019 and out years.

$0.0

$0.0

 

Tax Revenue=

$1,138.0

$2,690.0

 

Increased hazardous waste permitting fees, in part to address permitting backlogs at the Department of Toxic Substances Control.

$3.6

N.A.

 

Extended hospital quality assurance fee for one year to Jan. 1, 2018. No change in taxpayer liability.

N.A.**

$850.0**

 

Non-Tax Revenue=

$3.6

$0.0

 

Revenue Total=

$1,141.6

$2,690.0

Colorado

Extended the number of years, from two to five, in which the Colorado Housing and Finance Authority (CHFA) may allocate low-income housing income tax credits for the development of low-income housing. The bill decreases revenue by a total of $90 million spread out over 12 tax years. The program is set to expire on Jan. 1, 2020. No change in taxpayer liability.

$0.0**

-$1.5**

 

Tax Revenue=

$0.0

$0.0

 

Increased fees for driver’s licenses and related services.

$1.1

$1.9

 

Created a monthly surcharge on all mobile wireless and Voice-over-Internet Protocol (VoIP) subscribers of 5 cents per line per month (60 cents per year). The additional surcharge revenue will be used to cover annual appropriations to the Reading Services for the Blind Cash Fund in the Colorado Department of Education (CDE) and the Colorado Commission for the Deaf and Hard of Hearing Cash Fund in the Department of Human Services (DHS).

$2.2

$2.2

 

Created a surcharge of $1-$2 (determined administratively) on all documents that a county clerk and recorder retains for recording or filing certain documents related to real estate deeds or tax liens. Fee revenue goes to an enterprise fund in the Secretary of State’s office and is exempt from the state’s constitutional revenue limit. The surcharge repeals on Dec. 31, 2021.

$0.9

$1.8

 

Non-Tax Revenue=

$4.2

$5.9

 

Revenue Total=

$4.2

$5.9

Connecticut

Postponed the sunset of the Angel Investor Tax Credit to July 1, 2019. No change in taxpayer liability.

-$3.0**

-$3.0**

 

Adopted a sales tax exemption for feminine hygiene products and disposable or reusable (non-adult) diapers. This exemption removes approximately $7.8 million from the tax base beginning on July 1, 2018.

$0.0

-$7.8

 

Tax Revenue=

$0.0

-$7.8

 

Capped probate court fees at $40,000 total for settling estates valued at $8.877 million. This change impacts the Probate Court Administration Fund and partially reverses a policy in last year’s budget that eliminated the $12,500 cap on estates over $2 million.

-$4.5

 -$4.5

 

Non-Tax Revenue=

-$4.5

-$4.5

 

Revenue Total=

-$4.5

-$12.3

Delaware

Adopted a change in income apportionment calculation.

-$8.2

-$17.6

 

Enacted a tax credit for research and development.

$0.0

-$3.5

 

Tax Revenue=

-$8.2

-$21.1

 

Revenue Total=

-$8.2

-$21.1

Florida

Conformed with federal tax code. Adopted Section 179 Expending Internal Revenue Code.

-$3.2

-$1.5

 

Enacted a phase-out of the asphalt tax.

-$0.5

-$1.0

 

Enacted a sales tax exemption for certain sales by Veteran Service Organizations.

-$1.2

-$1.4

 

Adopted a Back-to-School sales tax holiday for calendar year 2016.

-$22.9

-$0.0

 

Expanded the medical use of cannabis.

$1.5

$3.1

 

Enacted a sales tax exemption for metal recyclers.

-$1.7

-$1.8

 

Enacted a permanent sales tax exemption for manufacturing machinery and equipment.

-$0.0

-$62.8

 

Tax Revenue=

-$17.5

-$55.6

 

Adopted an out-of-state college tuition fee waiver for active duty service members.

-$1.0

-$1.1

 

Enacted a concealed weapon license fee reduction.

-$3.5

-$2.8

 

Enacted fingerprint retention fees.

$1.3

$1.1

 

Corporate income tax due date changes.

-$13.7

Indeterminate

 

See Appendix D for property tax actions.

 

 

 

Non-Tax Revenue=

-$16.9

-$2.8

 

Revenue Total=

-$34.4

-$58.4
 

Georgia

Conformed to the federal tax code by enacting an exclusion for discharged home mortgage debt.

-$9.1

-$0.8

 

Conformed to the federal tax code by adopting mortgage insurance premiums as a deductible.

-$4.8

-$0.5

 

Conformed to the federal tax code by updating other miscellaneous items less than $5 per year.

-$19.7

$12.9

 

Adopted an income deduction for contribution to college savings plans for married taxpayers filing jointly.

-$2.0

-$2.3

 

Enacted personal tax credits for contributions to "rural hospital organizations" and "critical access hospitals."

-$25.0

-$55.0

 

Enacted personal tax credits for land donated to the state for conservation use. These credits are set to expire on Dec. 31, 2021.

-$17.2

-$17.2

 

Enacted corporate tax credits for contributions to "rural hospital organizations" and "critical access hospitals."

N.A.

N.A.

 

Conformed to federal tax code by updating research tax credit.

-$43.1

-$45.5

 

Conformed to federal tax code by updating limitation in Section 179 to $500,000, expensing made permanent.

-$46.2

-$28.9

Georgia, continued

Extended sales tax exemption for construction of competitive projects of regional significance. The exemption is now set to expire on June 30, 2019. No change in taxpayer liability.

-$4.3**

-$8.6**

 

Created a sales tax exemption on admission to non-recurring major sporting events. This is expected to generate at least $50 million in state revenue. The tax exemption is set to expire on Dec. 31, 2022.

-$0.9

-$2.6

 

Adopted a sales tax holiday on energy efficient products. The tax holiday was valid from Sept. 30, 2016 to Oct. 2, 2016.

-$1.0

$0.0

 

Adopted a Back-to-School sales tax holiday on July 30, 2016.

-$42.0

$0.0

 

Tax Revenue =

-$211.0

-$165.7

 

Revenue Total=

-$211.0

-$165.7

Hawaii

Adopted an organic food production credit. The credit is set to sunset on Dec. 31, 2021.

-$2.0

-$2.0

 

Adopted a renewable fuels income tax credit. The credit is set to sunset on Dec. 31, 2021.

-$3.0

-$3.0

 

Tax Revenue=

-$5.0

-$5.0

 

Low-Income Housing Tax Credits (LIHTC) Acceleration. The acceleration is set to terminate on Dec. 31, 2021.

N.A.

N.A.

 

Non-Tax Revenue=

N.A.

N.A.

 

Revenue Total=

-$5.0

-$5.0

Idaho

Conformed personal income taxes to the federal tax code.

-$28.7

-$28.7

 

Tax Revenue=

-$28.7

-$28.7

 

Adopted a surcharge for penalties directed to General Fund rather than specific purposes.

$2.9

$2.9

 

Non-Tax Revenue=

$2.9

$2.9

 

Revenue Total=

-$25.8

-$25.8

Illinois

No significant tax changes in 2016.

N.A.

N.A.

Indiana

Phased in rate reduction of the individual income tax from 3.4 percent in tax year (TY) 2014 to 3.23 percent in TY 2017. Changed rate from 3.4 percent to 3.3 percent in TY 2015 and TY 2016 and 3.23 percent in years after that. Original legislation enacted in 2013 legislative session.

-$197.4

-$270.3

 

Conformed personal income taxes to the federal tax code.

-$15.4

-$12.2

 

Expanded eligibility for dependent exemption, effective Jan. 1, 2018.

-$0.0

-$0.0

 

Phased in reduction of corporate income tax from 8.5 percent in FY 2012 to 6.5 percent in FY 2016, originally adopted in the 2011 legislative session. In the 2014 session, the corporate income tax rate was further phased down from 6.5 percent in FY 2016 to 4.9 percent in FY 2022 and thereafter. The rate for FY 2017 is 6.25 percent, to be phased down to 6.0 percent in FY 2018.

-$167.6

-$193.5

Indiana, continued

Phased in reduction of financial institution tax (FIT) from 8.5 percent in calendar year (CY) 2013 to 6.5 percent in CY 2017. The original legislation was adopted in the 2013 session and the law also changed the distributions of the FIT revenues. In the 2014 session, the FIT rate was further phased down from 6.5 percent in CY 2018 to 4.9 percent in CY 2023 and thereafter. The rate for CY 2017 and CY 2018 will be 6.5 percent.

-$32.3

-$26.3

 

Expanded the eligibility for the Industrial Recovery tax credit.

$0.0

-$1.7

 

Extended the Venture Capital Investment tax credit to Dec. 31, 2020. No change in taxpayer liability.

N.A.**

-$5.4**

 

Extended the Hoosier Business Investment tax credit to Dec. 31, 2020. No change in taxpayer liability.

N.A.**

-$8.9**

 

Enacted a requirement that contractors collect sales tax on the retail price of construction materials under time and materials contracts. This change reverses a tax court decision that would have required the Department of Revenue to issue refunds. Previously, use tax was due on the wholesale price of these construction materials.

$7.9

$7.9

 

Enacted a requirement that a person who rents rooms in a house, condo or apartment for less than 30 days must collect sales tax.

Indeterminate, but a potentially significant increase

Indeterminate, but a potentially significant increase

 

Adopted a sales tax exemption for legal tender, coins and bullion.

-$1.5

-$1.5

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$406.3

-$497.6

 

Revenue Total=

-$406.3

-$497.6

Iowa

Conformed personal income taxes to the federal tax code for TY 2015 only.

$23.0

$0.0

 

Extended the solar energy tax credit. The credit now expires after TY 2021.

$0.0

-$2.5

 

Enacted a new version of the Geothermal Energy tax credit.

$0.0

-$1.5

 

Enacted a renewable chemical tax credit. The negative revenue impact begins FY 2019 with an expected net revenue of -$92.5 million between FY 2019 and FY 2031. This credit is offset by reductions in other tax credits.

$0.0

$0.0

 

Expanded the definition of sales tax exempt manufacturing consumables.

-$21.3

-$22.4

 

 

 

Extended the Environmental Protection Charge for motor fuel taxes. The $0.01 per gallon tax was extended six months and expired on Dec. 31, 2016. No change in taxpayer liability.

$7.0**

$0.0**

 

Tax Revenue=

$1.7

-$26.4

 

Revenue Total=

$1.7

-$26.4

Kansas

Effective date of e-cigarette tax decelerated from July 1, 2016 to Jan. 1, 2017.

$0.0

 

-$1.0

 

Kansas, continued

Tax Revenue=

$0.0

-$1.0

 

Enacted new fees of $3.25 annually for each vehicle to increase highway patrol and law enforcement training funding. Increased fee from $39.00 to $42.25.

$9.1

$0.0

 

See Appendix D for property tax actions.

 

 

 

Non-Tax Revenue=

$9.1

$0.0

 

Revenue Total=

$9.1

-$1.0

Kentucky

Created a felony record expungement petition filing fee. The fee is $500.

$1.0

$1.0

 

Non-Tax Revenue=

$1.0

$1.0

 

Revenue Total=

$1.0

$1.0

Louisiana

Increased the excise tax rates on beer and other alcoholic beverages. Inventories on hand are not subject to the rate increase.

$19.2

$19.3

 

Reinstated a 3 percent excise tax on short-term automobile rentals, with a 2.5 percent tax for state government and a 0.5 percent tax for local entities.

$5.0

$5.0

 

Expanded the corporate franchise tax to other forms of business organizations other than traditional C-corporations. The bill also provided an exception for subsidiaries of S-corps purchased between Jan. 1, 2012 and Jan. 1, 2014.

$10.3

$89.3

 

Imposed various limitations to the Enterprise Zone Program, with accumulating state revenue gains as program costs are diminished.

$0.0

$2.0

 

Modified the refundability of inventory credit by establishing a tiered structure that effectively reduces the aggregate amount of credit that is refundable in excess of offsetting tax liabilities. Credit balances not refundable are allowed a five-year carry-forward against future tax liabilities. Applicable to all tax returns filed on and after July 1, 2016.

$17.3

$17.3

 

Modified the refundability of inventory credit available to manufacturers with ad valorem industrial tax exemption benefits. Credit available in excess of tax liabilities are not to be refunded, but are allowed a five-year carry-forward against future tax liabilities. Applicable to all tax returns filed on and after July 1, 2016.

$57.0

$57.0

 

Increased the state sales tax rate by 1 percent on the traditional base of transactions. It also subjected various formerly exempt transactions to the new levy. This tax increase is set to expire on June 30, 2018.

$880.6

$880.6

 

Passed legislation which subjects formerly exempt transactions to the state sales tax. This measure is set to expire on June 30, 2018.

$272.3

$272.3

Louisiana, continued

Capped vendor compensation to dealers remitting state sales tax at $1,500 per month ($18,000 per year), and compensation is only allowed on the original 4.0 percent sales tax rate.

$14.6

$14.6

 

Expanded the definition of hotel to include establishments with any number of rooms including residential locations furnished to transient guests. The receipts are received by the general sales tax, but are generally dedicated to the local area from which they are generated.

Increase

Increase

 

Renewed a 1 percent state sales tax on interstate telecommunications services. No change in taxpayer liability.

$3.4**

$3.4**

 

Increased tax on cigarettes by 22 cents, from 86 cents per pack to $1.08 per pack.

$46.0

$46.0

 

Made a 5 percent reduction in the investment tax credit against premium tax that is available to insurers based on the share of admitted assets they hold in various Louisiana investments. This is effective for premium years 2016 and 2017. Also, imposed a 6 percent tax on premiums of health maintenance organizations participating in the State Bayou Health Program, which provides health care services to low-income populations.

$8.3

$8.6

 

Permanently reduced the Citizens Assessment credit to 25 percent of the assessment paid on insurance policies. The credit is already reduced to 72 percent through FY 2018, then was scheduled to return to 100 percent after that.

$17.0

$21.2

 

Imposed a minimum five-year in-state domiciled requirement before gains from a sale of controlling interest in a business qualifies for a deduction from taxable income. The minimum deduction is 50 percent of the gains, climbing to 100 percent of the gain if held for 30 years or more.

Increase

Increase

 

Increased the premium tax on health maintenance organizations from 2.25 percent to 5.5 percent effective for calendar year 2016. Roughly 90 percent of these receipts will be dedicated to the Medical Assistance Trust Fund

$187.0

$124.0

Exempted health maintenance organizations from the reduction in the investment tax credit against premium tax liabilities that was enacted in Act 10 of 2016 Extraordinary Session 1 for FY 2017 and FY 2018.

-$1.3

-$1.3

 

 

 

Medicaid expansion increased premium tax collections at the existing 2.25 percent tax rate. These receipts will be dedicated to the Medical Assistance Trust Fund.

$23.8

$59.6

 

Medicaid expansion increased premium tax collections as a result of the 3.25 percent tax rate increase on health maintenance organizations from 2.25 percent to 5.5 percent effective for calendar year 2016. These receipts will be dedicated to the Medical Assistance Trust Fund.

$34.5

$86.1

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

$1,591.6

$1,701.6

 

Authorized the Department of Health to increase the per-bed per-day fee charged to nursing facilities.

$16.9

$16.9

Louisiana, continued

Authorized the Department of Health to establish a provider fee for emergency ground ambulance service providers.

$2.5

$2.5

 

Reduced aggregate interest payments on overpayments of tax by starting payments 90 days after the later of the tax return due date, the return filing date, or payment date. Realized as an increase in net tax collections. Composed primarily of corporate tax, 75 percent; sales tax, 20 percent; and severance tax/others, 5 percent. Some small amount accrues to dedications.

$16.7

$20.0

 

Expanded the definition of dealer by establishing a nexus through affiliate arrangements involving independent contractor or other relationships. This was done in an attempt to provide enforcement and compliance from remote sellers. Additional collections from remote or online sellers is possible, but material compliance and collections are not expected.

Increase

Increase

 

Reduced the discounts provided for timely filing and remittance of excise taxes on cigarettes and other tobacco products.

$2.2

$2.2

 

Non-Tax Revenue=

$38.3

$41.6

 

Revenue Total=

$1,629.9

$1,743.2

Maine

Partially conformed personal income taxes to the federal tax code.

-$12.7

-$6.3

 

Expanded the educational opportunity income tax credit, which is a credit for repayment of student loans.

-$0.4

-$1.0

 

Partially conformed corporate taxes to the federal tax code.

-$6.7

-$6.4

 

Adopted a sales tax exemption for fuel used in commercial agriculture, aquaculture, fishing and wood harvesting.

-$3.5

-$10.0

 

Enacted a 3 percent surcharge on taxable income of $200,000 beginning with tax years on or after Jan.1, 2017. Revenue from this tax will be placed in the Fund to Advance Public Kindergarten to Grade 12 Education. This fund was established for the purpose of improving the ability of the state to reach the annual target of 55 percent for the state share of funding K-12 public education.

$43.8

$150.4

 

 

Legalized possession and use of marijuana by a person 21 years of age or older. The bill places a sales tax of 10 percent on retail marijuana and retail marijuana products.

$2.7

$10.5

 

Tax Revenue=

$23.2

$137.2

 

Revenue Total=

$23.2

$137.2

Maryland

Adopted a refundable credit for up to $5,000 for qualified student loan debt.

$0.0

-$5.0

 

Enacted a credit for businesses operating a qualifying aerospace, electronics or defense contract tax credit project. The credit is equal to $250 per qualified employee, subject to a $2.5 million maximum value per project. The credit is set to expire on June 30, 2021.

-$7.5

-$7.5

Maryland, continued

Altered and extended the Heritage Structure Rehabilitation Tax Credit. This tax credit is now set to expire on July 1, 2022.

$0.0

-$9.3

 

Enacted a sales tax exemption for construction material or warehousing equipment purchased for use in certain qualified redevelopment projects. This exemption is set to expire on Sept. 30, 2026.

-$1.0

Indeterminate, but revenue decrease is assumed to exceed $1 million annually

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$8.5

-$21.8

 

Altered the calculation of the annual interest rate set for tax deficiencies and refunds.

-$2.1

-$8.0

 

Reduced birth and death certificate fees from $24 to $10.

-$3.6

-$3.1

 

Non-Tax Revenue=

-$5.7

-$11.1

 

Revenue Total=

-$14.2

-$32.9

Massachusetts

Adopted an Earned Income Tax Credit.

-$74.0

N.A.

 

Reduction of income tax rate by 0.05 percent, from 5.15 percent to 5.10 percent effective Jan. 1, 2016. This is part of a larger reform in which the rate is scheduled to be gradually reduced by 0.05 percent increments contingent on baseline tax revenue growth. The trigger was not met for a reduction in 2017.

-$152.0

-$152.0

 

Legalized possession and use of marijuana by a person 21 years of age or older. Retail marijuana is subject to the state sales tax with an additional 3.75 percent excise tax. Local municipalities are given the option of adding an additional 2 percent tax.

Retail stores set to open July 2018. Out-year fiscal impact unknown.

N.A.

 

Tax Revenue=

-$226.0

-$152.0

 

Revenue Total=

-$226.0

-$152.0

Michigan

Repealed the Insurance Tax Credit.

$80.0

$80.0

 

Reduced the state use tax in order to create a local use tax. This measure is part of a personal property tax reform package adopted in 2012 to reimburse local units for revenue. The combined state and local tax rate remains at 6 percent.

-$380.9

-$410.8

 

Extended the sunset on the cap on the maximum tax applied to a cigar. No change in taxpayer liability.

-$2.5

-$2.5

 

Raised the gas tax rate from 19 cents per gallon to 26 cents per gallon as part of a transportation funding package enacted in November 2015. This legislation also modified alternative fuel taxes.

$135.7

$212.8

 

Raised the tax rate for diesel fuels from 15 cents per gallon to 26 cents per gallon as part of a transportation funding package enacted in November 2015.

$69.0

$92.9

 

See Appendix D for property tax actions.

 

 

Michigan, continued

Tax Revenue=

-$96.2

-$25.1

 

Changed the rate of record lookup fees for the Secretary of State from $8 to $11.

$14.1

$14.1

 

Changed the rate of motor vehicle registration fees. Fees vary, but are now generally 20 percent higher than the old rate. This was part of a larger transportation funding package enacted in November 2015.

$158.4

$215.9

 

Non-Tax Revenue=

$172.5

$230.0

 

Revenue Total=

$76.3

$204.9

Minnesota

Enacted a Military Pension Subtraction.

-$22.6

-$23.7

 

Extended the Small Business Investment Tax Credit for one additional year. No change in taxpayer liability.

$0.0**

-$10.0**

 

Altered the sales tax on modular homes to 6.5 percent of the invoice price.

-$1.0

-$1.1

 

Tax Revenue=

-$23.6

-$24.8

 

Revenue Total=

-$23.6

-$24.8

Mississippi

Enacted the Taxpayer Pay Raise Act of 2016. This bill phases out personal income tax on the first $5,000 of taxable income over a five-year period beginning in CY 2018. Changes from three percent on the first $5,000 of taxable income to 0 percent on the first $5,000 of taxable income once the five-year phase-in is complete. This is part of a larger reform measure which also phases out the franchise tax, phases out the 3 percent rate on corporate income, and provides a self-employment tax deduction.

$0.0

-$14.4

 

Enacted the Taxpayer Pay Raise Act of 2016.  This bill phases out corporate income tax on the first $5,000 of taxable income over a five-year period beginning in CY 2018. Changes rate from 3 percent on the first $5,000 of taxable income to 0 percent on the first $5,000 of taxable income once the five-year phase-in is complete.

$0.0

-$0.2

 

Enacted the Taxpayer Pay Raise Act of 2016. This legislation phases out Franchise Tax over a 10-year period. The phase-out begins in CY 2019.

$0.0

$0.0

 

Enacted the Taxpayer Pay Raise Act of 2016. This legislation provides a self-employment tax deduction beginning in calendar year 2017. This deduction is based on self-employment taxes imposed and will be implemented as follows: 17 percent of federal self-employment taxes imposed for taxable years ending in CY 2017; 34 percent of federal self-employment taxes imposed for taxable years ending in CY 2018; and 50 percent of federal self-employment taxes imposed for taxable years ending in CY 2019 and thereafter.

$0.0

-$3.4

Mississippi, continued

Provided a tax credit for inventory taxes paid. This is phased in over a four-year period beginning in FY 2014.  FY 2014 -$7 million, FY 2015 -$14 million, FY 2016 -$21 million and FY2017 -$126 million. These figures represent the cumulative loss in revenue per Department of Revenue. Originally enacted during the 2012 regular session.

-$84.0

$0.0

 

Clarified that certain sales to schools under federal programs are exempt and revised the exemption for durable medical equipment.

N.A.

N.A.

 

Tax Revenue=

-$84.0

-$18.0

 

Revenue Total=

-$84.0

-$18.0

Missouri

Continued to phase-in an income tax reduction of top bracket to 5.5 percent from 6 percent by 0.1 percent increments annually. Continued phase-in of a 25 percent deduction of business income by 5 percent increments annually. Increased personal exemption by $500 for Missouri adjusted gross incomes less than $20,000. Adjusts brackets for inflation annually. This legislation was originally enacted in 2014.

-$72.5

-$145.7

 

Enacted an exemption for payments from agricultural disaster programs.

-$12.0

N.A.

 

Adopted an exemption for income from individuals in the active duty military service.

-$3.0

-$3.6

 

Allowed for a 50 percent deduction for costs related to business relocation to Missouri and expanded Brownfield tax credit.

-$0.8

-$6.0

 

Amended the Missouri Constitution to prohibit a new state or local sales and use or other similar tax on any service or transaction. This amendment only applies to any service or transaction that was not subject to a sales and use or similar tax as of Jan. 1, 2015.

$0.0

$0.0

 

Extended for 10 years the 0.1 percent sales and use tax that is used for soil and water conservation and for state parks and historic sites. This tax will be resubmitted to the voters for approval in 10 years. No change in taxpayer liability.

$90.0**

$90.0**

 

Tax Revenue=

-$88.3

-$155.3

 

Revenue Total=

-$88.3

-$155.3

Montana

Implemented previously enacted tax credits for contributions to public and private schools. This change was made by a departmental ruling on a bill from the 2015 legislative session; the Montana Legislature did not convene in 2016.        

$2.8

$2.8

 

Tax Revenue=

$2.8

$2.8

 

Revenue Total=

$2.8

$2.8

Nebraska

Enacted a school readiness tax credit.

$0.0

-$0.9

 

Enacted various sales tax exemptions.

-$1.5

-$2.4

Nebraska, continued

Changed provisions of the Convention Center Facility Financing Assistance Act and the Sports Arena Facility Financing Assistance Act and adopted the Affordable Housing Tax Credit Act.

-$1.4

-$3.3

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$2.9

-$26.6

 

Revenue Total=

-$2.9

-$26.6

Nevada

Restructured the modified business tax—general business (general businesses exclude financial and mining businesses), which was scheduled to sunset. The tax rate went up from 1.17 percent to 1.475 percent and the exemption for taxable wages was decreased from $85,000 to $50,000 per quarter. The legislation also removed mining businesses from the tax base. No change in taxpayer liability.

$281.4**

N.A.

 

Restructured the modified business tax on mining businesses so that they are required to pay the net proceeds of mineral tax instead of the modified business tax on general business. Under the new provisions, all quarterly taxable wages are taxed at 2.0 percent. No change in taxpayer liability.

$6.5**

N.A.

 

Approved a commerce tax on the gross revenue of each business entity whose Nevada gross revenue exceeds $4 million in a fiscal year. There are 26 different rates based on different industry codes, ranging from 0.051 percent to 0.331 percent. No change in taxpayer liability.

$119.8**

N.A.

 

Approved a new commerce tax credit, which is allowed against the modified business tax due during the fiscal year not to exceed 50 percent of the commerce tax paid for the preceding fiscal year. No change in taxpayer liability.

-$59.3**

N.A.

 

Extended the local school support sales tax increase of 0.35 percent that was scheduled to sunset on June 30, 2015. No change in taxpayer liability.

$193.7**

N.A.

 

Raised the cigarette tax by $1 per pack. The rate went from $0.80 to $1.80 per pack. No change in taxpayer liability.

$95.4**

N.A.

 

Imposes a new 3 percent excise tax on the fare charged by a transportation network company (Uber and Lyft), a common motor carrier of passengers or a taxicab. No change in taxpayer liability.

$22.9**

N.A.

 

Enacted a ballot measure legalizing the possession and use of marijuana by a person 21 years of age or older. An excise tax of 15 percent is imposed on wholesale sales of marijuana. The existing state sales tax would apply to retail sales of marijuana. Net revenue generated from this tax will be used for the support of K-12 education. No change in taxpayer liability.

Indeterminate

Indeterminate

Nevada, continued

Adopted a ballot measure that will bring the question to vote to add new sections to the Nevada Constitution exempting durable medical equipment, oxygen delivery equipment and mobility enhancing equipment from the sales and use tax when such equipment is prescribed for human use by a licensed health care provider. Needs to be approved in 2018 general election to become law. No change in taxpayer liability.

N.A.

N.A.

 

Tax Revenue=

$466.7

$N.A.

 

Raised the business license fee to $500 per year for corporations and $200 per year for non-corporation type businesses. No change in taxpayer liability.

$64.3**

N.A.

 

Increased commercial recording fees. No change in taxpayer liability.

$2.8**

Indeterminate Increase

 

Non-Tax Revenue=

$67.1**

N.A.

 

Revenue Total=

$533.8**

N.A.

New Hampshire

Decreased Business Profits Tax rate from 8.5 percent to 8.2 percent.

-$12.0

-$14.9

 

Decreased Business Enterprise tax rate from 0.75 percent to 0.72 percent.

-$9.1

-$12.4

 

Increased Research and Development tax credit from $2 million aggregate to $7 million aggregate.

$0.0

$0.0

 

Tax Revenue=

-$21.1

-$27.3

 

Revenue Total=

-$21.1

-$27.3

New Jersey

Enacted a personal income tax exemption of $3,000 for veterans.

$0.0

-$23.0

 

Increased the earned income tax credit from 30 percent to 35 percent of the federal credit.

-$62.0

-$63.5

 

Enacted legislation to increase annually, in equal installments, the exclusion of pension income from $20,000 (married filing joint) to $100,000 in TY 2020.

$0.0

-$75.0

 

Increased cap on Economic Redevelopment and Growth tax credits by $90 million.

N.A.

N.A.

 

Decreased state sales tax rate from 7 percent to 6.875 percent for TY 2017. This is part one of a two-part phase-in. On Jan. 1, 2018, the state sales tax rate will decrease from 6.875 percent to 6.625 percent as the second part of the phase-in of the new rate.

-$92.4

Out-year fiscal impact unclear

 

Expiration of the reduced tax rate of 50 percent of taxation in certain urban enterprise zones. The tax rate has returned to 100 percent of the original rate.

$10.0

$19.0

 

Modified estate tax to increase the exclusion from $675,000 to $2 million as of Jan. 1, 2017. The exclusion will increase to 100 percent of the estate beginning Jan. 1, 2018.

-$16.0

-$116.4

New Jersey, continued

Increased petroleum products gross receipts tax for highway fuels (excluding diesel) by 12.85 percent or [KQ1] 22.6 cents per gallon. Effective Nov. 1, 2016. The gross receipts tax for diesel fuel will also increase to 70 percent of highway fuels tax rate effective Jan. 1, 2017, increasing to 100 percent of the rate on July 1, 2017. This rate will be adjusted annually to cap revenue. This revenue estimate includes revenue from both highway fuel and diesel taxation.

$694.1

$1,159.6

 

Increased the petroleum products gross receipts tax on non-highway fuel oil and non-fuel products. The rate was increased from 2.75 percent to 7 percent, or 12.4 cents per gallon. The cents on the gallon calculation is adjusted quarterly based on price for fuel oil only.

$20.7

$31.1

 

Increased the petroleum products gross receipts tax on diesel fuel. The increased rate will be phased in between Jan. 1, 2017 and July 1, 2017. The new rate will be 8 cents per gallon; the old rate was 4 cents per gallon.

$0.0

$39.6

 

Tax Revenue=

$554.4

$971.4

 

Revenue Total=

$554.4

$971.4

New Mexico

Extended and amended the Sustainable Building Tax Credit against the personal and corporate income tax. Extended the credit beyond current sunset of Dec. 31, 2016 to Dec. 31, 2026. This legislation was originally enacted in 2015. No change in taxpayer liability.

$5.0**

$5.0**

 

Reduced corporate income tax rate from 4.8-7.6 percent to 4.8-5.9 percent.

-$70.5

-$70.5

 

Continued five-year phase-in of corporate income tax optional single sales factor apportioning for manufacturers. This legislation was originally enacted in 2013.

-$45.3

-$45.3

 

Tax Revenue=

-$115.8

-$115.8

 

Revenue Total=

-$115.8

-$115.8

New York

Enacted legislation that will provide middle class taxpayers with a permanent 20 percent rate reduction over eight years. Changed rate from 6.85 percent to 5.5 percent and 6 percent. Fiscal impact is $4.2 billion annually when fully effective.

$0.0

-$236.0

 

Eliminated the existing STAR property tax exemption for new applicants and replaced with a refundable tax credit. The reduction in revenue is accompanied by a corresponding savings in spending, making this change overall revenue neutral.

-$98.0

-$194.0

 

Extended for five years the Clean Heating Fuel Tax Credit. To qualify each gallon of clean heating fuel must be at least 6 percent biodiesel. The fiscal impact begins in FY 2019 with a revenue loss of $1 million annually. No change in taxpayer liability.

$0.0**

$0.0**

 

Enacted legislation to make the non-custodial parent earned income tax credit permanent. The fiscal impact begins in FY 2019 with a revenue loss of $4 million annually.

$0.0

$0.0

New York, continued

Created the Farm Workforce Retention Credit, which allows farm employers to claim a refundable tax credit for each farm employee. The purpose is to offset the impact of the minimum wage increase. The fiscal impact begins in FY 2019 with a revenue loss of $15 million and a revenue loss of $37 in FY 2023.

$0.0

$0.0

 

Extended the Hire-A-Vet tax credit for 2 years. The fiscal impact takes effect in 2019 and 2020 with a revenue loss of $37 million for these years. This measure is now set to expire on Dec. 31, 2018. No change in taxpayer liability.

$0.0**

$0.0**

 

Authorized an additional $8 million in low-income housing credits to be allocated in FY 2017 through March 31, 2021.

$0.0

-$8.0

 

Authorized an additional $30 million of tax credits for Urban Youth Tax Credits allocated in tax years 2016 and 2017. Extended the eligibility to non-metro areas.

$0.0

-$30.0

 

Extended the Empire State Commercial Production Tax Credit for two years. The fiscal impact will take effect in FY 2019 and FY 2020 resulting in a revenue loss of $7 million for these years. The tax credit is now set to expire on Dec. 31, 2018. No change in taxpayer liability.

$0.0**

$0.0**

 

Made the Special Additional Mortgage Recording Tax refundable under corporate franchise tax for all taxpayers. Part of the technical cleanup from 2014 corporate tax reform.

-$15.0

-$15.0

 

Extended the credit for purchasing or upgrading a for-hire vehicle for use by disabled individuals through 2022. The fiscal impact begins in FY 2019 and will result in a $5 million annual revenue loss. The credit is now set to expire on Dec. 31, 2022. No change in taxpayer liability.

$0.0**

$0.0**

 

Adopted an Alcohol Beverage Production credit to extend to wine, cider and liquor. Also includes a sales tax exemption for alcoholic beverages used for tastings.

-$1.0

-$3.0

 

Expanded eligibility for Economic Transformation and Revitalization Program credits to psych centers.

$0.0

-$2.0

 

Enacted a sales tax exemption for the purchase of fuel cells.

-$4.0

-$2.0

 

Extended the alternative fuels tax exemptions (sales tax, petroleum business tax and motor fuel tax). These exemptions are set to expire on Aug. 31, 2021. No change in taxpayer liability.

-$0.5**

-$1.0**

 

Tax Revenue=

-$118.0

-$490.0

 

Reduced the Highway Use Tax Registration and Decal fee. Reduced the rate from $19 to $1.50.

-$59.0

-$6.0

 

Allowed state flagship schools to increase out-of-state tuition by 10 percent.

$22.0

$22.0

 

Non-Tax Revenue=

-$37.0

$16.0

 

Revenue Total=

-$155.0

-$474.0

North Carolina

Increased standard deductions by $2,000 over two years ($1,000 increase for each year) to a new limit of $17,500.

-$145.0

-$205.0

North Carolina, continued

Reduced corporate income tax rate from 4 percent to 3 percent as a result of legislation passed in 2015 that created a trigger for a 1 percent reduction in the corporate income tax the following tax year when the amount of net General Fund tax collected in a fiscal year exceeded $20,975,000.

N.A.

N.A.

 

Modified sales tax base on repairs, maintenance and installation.

$22.4

$49.8

 

Enacted a sales and use tax exemption on Styrofoam pellets for wastewater system materials.

-$1.0

-$1.0

 

Repealed a tax on automotive service contracts.

-$1.6

-$3.5

 

Expanded mill machinery tax (1 percent per $80.00) to metal fabricators and secondary metal recyclers.

$1.6

-$1.8

 

Tax Revenue=

-$123.6

-$157.9

 

Revenue Total=

-$123.6

-$157.9

North Dakota

Continued phase-in of an alternate income apportionment method (single sales factor) for calculating the corporate income tax.

-$7.5

-$25.0

 

Exempted sales tax for the sale of internet access services. The tax rate is reduced from 5 percent to 0 percent.

$0.0

-$10.0

 

Tax Revenue=

-$7.5

-$35.0

 

Revenue Total=

-$7.5

-$35.0

Ohio

Enhanced the motion picture tax credit.

-$20.0

-$20.0

 

Adopted a sales tax holiday for three days in August 2016.

-$15.1

$0.0

 

Enacted a sales tax exemption for sales of natural gas by municipally owned gas company.

-$6.9

-$2.1

 

Tax Revenue=

-$42.0

-$22.1

 

Revenue Total=

-$42.0

-$22.1

Oklahoma

Placed a cap on the Investment/New Jobs tax credit. This cap is set to expire Dec. 31, 2018. This change affects personal income tax revenues.

$2.0

N.A.

 

Enacted legislation which makes the state earned income tax credit non-refundable for all tax years after Jan. 1, 2016.

$24.8

N.A.

 

Enacted legislation to elimination the "Double Deduction" and require state and local income or sales taxes included in itemized deductions be added back to calculate Oklahoma taxable income (by subtracting them from itemized deductions). Effective for TY 2016.

$83.3

N.A.

 

Placed a cap on the Investment/New Jobs tax credit. This cap is set to expire Dec. 31, 2018. This change affects corporate income tax revenues.

$9.1

N.A.

 

Ended a gross production tax incentive for economically at-risk oil and gas leases. The measure limits the exemption to production from CY 2014 and provides that no claims for refunds will be paid after Dec. 31, 2016.

$51.8

N.A.

Oklahoma, continued

Tax Revenue=

$170.9

N.A.

 

Enacted a Tax Commission initiative to enhance enforcement of personal income, corporate income, sales and use, and miscellaneous tax collections.

$46.6

N.A.

 

Reissued the official state license plate with a new license plate design.

$13.0

N.A.

 

Non-Tax Revenue=

$59.6

N.A.

 

Revenue Total=

$230.6

N.A.

Oregon

Expanded the earned income tax credit. The new rate applies only to taxpayers with dependents 2 years old or younger. Increased from 8 percent of federal credit to 11 percent of federal credit. The entire credit is set to sunset on Jan. 1, 2020.

$0.0

-$5.0

 

Increased the annual cap for the film and video tax credit from $10 million to $14 million. The entire credit is set to sunset on Jan. 1, 2022.

-$1.8

-$4.0

 

Modified and extended the corporate income tax credit for biomass production. Decreased the credit from $5 per wet ton to $3.50 per wet ton. The entire credit is set to sunset on Jan. 1, 2022.

$1.6

-$4.3

 

Increased the rate of the statewide transient lodging tax from 1 percent to 1.8 percent.

$13.6

$14.4

 

Tax Revenue=

$13.4

$1.1

 

Revenue Total=

$13.4

$1.1

Pennsylvania

Expanded the tax base to include Pennsylvania Lottery winnings on cash prizes. Non-cash prizes of Pennsylvania Lottery remain exempt.

$15.8

$13.6

 

Imposed a sales tax on digital downloads of books, music, photographs, games, audio, apps, canned software, satellite radio, and streaming video and audio

$46.9

$59.2

 

Exempted the business of producing or harvesting trees for commercial production of wood, paper or energy products from sales tax.

$0.0

-$2.5

 

Introduced a cap on the current 1 percent vendor discount on timely filed returns. It is now capped at $300 per year or 1 percent of remittance, whichever is smaller. Business with taxable sales of $500,000 or less are not affected.

$55.5

$69.2

 

Increased tax on cigarettes by $1, from $1.60 per pack to $2.60 per pack.

$431.1

$446.6

 

Introduced a 55 cent per ounce tax on alternative tobacco products such as smokeless tobacco and roll-your-own cigarettes with a floor minimum weight of 1.2 ounces.

$51.3

$81.9

 

Enacted a tax on e-cigarettes of 40 percent of the wholesale price imposed on vapor producing devices and liquid cartridges.

$13.3

$21.3

Pennsylvania, continued

Increased the Bank Shares Tax rate from 0.89 percent to 0.95 percent for the calendar year beginning Jan. 1, 2017 and each year thereafter.

$23.5

$24.8

 

Introduced the Bank Shares Tax Edge Act Exclusions. Banks can exclude 20 percent of the book value of total equity capital of foreign subsidiaries from taxable income for the year beginning Jan. 1, 2018. There is a five-year phase-in allowing an additional 20 percent exclusion each year.

$0.0

-$2.9

 

Adopted numerous changes to various tax credit programs.

-$20.9

-$49.3

 

In addition to the current table games tax of 12 percent, the state adopted a separate two percent tax on gross table game revenue. This additional rate will sunset in three years on June 30, 2019.

$16.8

$17.7

 

Established a tax refund program for sales tax paid on computer data center equipment purchases for qualified centers. The program is capped at $5 million.

$0.0

-$5.0

 

Tax Revenue=

$633.3

$674.6

 

Introduced non-recurring liquor modernization revenue through licensee surcharges, auctioning of restaurant licenses, and casino license fees.

$73.2

$0.0

 

Introduced a tax amnesty program. During a 60-day period within 2016-2017, delinquent taxpayers will be able to have penalties and 50 percent of interest waived on delinquencies that existed prior to Dec. 31, 2015.

$100.0

-$25.0

 

Non-Tax Revenue=

$173.2

-$25.0

 

Revenue Total=

$806.5

$649.6

Rhode Island

Exempted first $15,000 of pension income, with qualifications.

-$6.3

-$13.0

 

Increased the earned income tax credit to 15 percent of federal rate. The previous rate was 12.5 percent.

-$2.7

-$5.5

 

Reduced the annual corporate minimum tax. This is the second consecutive budget to reduce minimum tax. The old minimum was $450; the new minimum is $400.

-$1.6

-$3.2

 

Tax Revenue=

-$10.6

-$21.7

 

Enhanced fraud and waste IT system increasing income and sales tax collections.

$5.0

$5.0

 

Enhanced compliance on retaliatory assessments for insurance tax.

$1.1

$1.1

 

Added additional staff and enhanced collection for personal income, business and sales tax.

$3.4

$3.4

 

Conducted a corporate tax intercompany transfer pricing audit.

$6.7

$0.0

 

Reduced the beach fees.

-$1.3

-$1.8

 

Non-Tax Revenue=

$14.9

$7.7

 

Revenue Total=

$4.3

-$14.0

South Carolina

Conformed personal income taxes to the federal tax code.

-$7.8

N.A. 

 

Adopted an income tax credit for qualified new jobs in the agricultural packaging industry. The credit varies based upon county designation.

N.A.

-$1.5

 

Adopted an income tax deduction for military retirement benefits attributable to active duty service. Deduction is equal up to $17,500 of earned income for taxpayers under age 65.

-$6.5

-$9.9

 

Adopted an income tax deduction for the construction, purchasing, or leasing of qualified solar energy property. May not exceed $2.5 million for all taxpayers. The deduction is set to expire on Dec. 31, 2017.

-$2.5

-$2.5

 

Adopted an income tax credit for 25 percent of the cost of purchase and installation of certain geothermal machinery and equipment. The credit may not exceed $3,500 for each facility. This credit is set to expire on Jan. 1, 2019.

-$1.0

-$1.0

 

Removed the 5 percent sales tax surcharge on car rentals and heavy equipment rentals.

-$1.9

N.A.

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$19.7

-$14.9

 

Revenue Total=

-$19.7

-$14.9

South Dakota

Increased state sales tax rate by 0.5 percent, from 4 percent to 4.5 percent. This provided additional money for teacher salaries and was offset by a reduction in property taxes.

$107.0

N.A.

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

$107.0

N.A.

 

Revenue Total=

$107.0

N.A.

Tennessee

Established a tax credit against the Hall Income Tax equal to 33 percent of the value of an investment by an angel investor, if certain conditions apply.

-$1.9

-$2.6

 

Enacted a reform measure that will eliminate the income tax over six years. It decreased the Hall Income Tax (HIT) rate from 6 percent to 5 percent for tax years beginning on or after Jan. 1, 2016. Also, established the legislative intent that the HIT be reduced by 1 percent annually through further enactments of general bills. The tax will be eliminated completely in tax year 2022 and beyond, for a revenue loss of $166.3 million annually.

-$27.7

-$27.7

 

Expanded the minimum requirement for a business to be considered a qualified data center for the purpose of being exempt from the sales and use tax on cooling equipment or backup power infrastructure. The minimum number of jobs required to be created decreased from 25 to 15, and the minimum capital investment required to be made decreased from $250 million to $100 million.

-$4.1

-$4.1

Tennessee, continued

Extended the Annual Coverage Assessment Act of 2016, which establishes an annual coverage assessment on hospitals of 4.52 percent of a covered hospital’s annual coverage assessment base and is required to be paid in equal quarterly installments. No change in taxpayer liability                                                  

$449.8**

N.A.

 

Extended the annual nursing home assessment for an additional year. No change in taxpayer liability.

$121.0**

N.A.

 

Extended the temporary 50 cent per barrel of beer tax and the temporary 0.4 percent tax on gross receipts until July 1, 2022, or until July of any year following the enactment of any state or federal law that imposes mandatory deposits by consumers on beverage containers sold in Tennessee, whichever occurs first.  No change in taxpayer liability

$4.9**

$4.9**

 

Tax Revenue=

-$33.7

-$34.4

 

Revised provisions governing overweight and over-dimensional loads that are permitted and non-divisible. Old and new rates are various, and revenue will go to the Highway Fund.

$3.7

$7.4

 

Made various changes to the Tennessee Higher Education Authorization Act, including, but not limited to, requiring adoption of new policies and fees for authorization of postsecondary education institutions.

-$1.1

-$1.1

 

Reduced the fee for a lifetime handgun carry permit from $500 to $300 for initial applicants and $200 for existing handgun carry permit holders.

$2.6

$5.2

 

Modified the franchise and excise tax regarding current requirements to make estimated quarterly payments. Reduced the penalty for underpayments.

-$11.8

-$5.6

 

Authorized terminal buildings of a commercial air carrier airport to sell packaged alcoholic beverages at retail, under certain conditions.

$6.9

$6.5

 

Non-Tax Revenue=

$0.3

$12.4

 

Revenue Total=

-$33.5

-$22.0

Texas

No significant tax changes in 2016.

N.A.

N.A.

Utah

Amended the corporate franchise and income tax. This offers computer and computer product manufacturers the option of filing their corporate return using either single sales, double weighted sales, or the three-factor formula.

-$2.6

-$2.8

 

Adjusted severance tax calculations to exclude royalty revenue in calculation of taxable value and taxable volume.

-$1.2

-$0.5

 

See Appendix D for property tax actions.

 

 

 

Tax Revenue=

-$3.8

-$3.3

 

Revenue Total=

-$3.8

-$3.3

Vermont

Adopted an ambulance provider tax at a rate of 3.3 percent.

$1.2

N.A.

Vermont, continued

Reduced the statewide property tax rates from $1.535 to $1.527 per $100 of assessed property value.

$9.9

N.A.

 

Increased fuel gross receipts tax from 0.5 percent per gallon to 0.75 percent, or 2 cents per gallon. Electricity is excluded from this increase. This is a temporary tax increase that is set to expire on June 30, 2021.

$3.8

N.A.

 

Tax Revenue=

$5.0

N.A.

 

Changed collection schedule for the fuel gross receipts tax from quarterly to monthly.

$1.0

N.A.

 

Changed collection schedule for the telephone property tax from quarterly to monthly.

$1.0

N.A.

 

Changed collection schedule for the bank franchise tax from quarterly to monthly.

$1.8

N.A.

 

Enacted multiple changes to the vehicle registration fees.

$9.9

N.A.

 

Adopted changes to public safety fees.

$1.5

N.A.

 

Increased mutual fund registration fee from $600 to $1,500.

$20.7

N.A.

 

Increased broker-dealer registration fee from $60 to $85.

$3.3

N.A.

 

See Appendix D for property tax actions.

 

 

 

Non-Tax Revenue=

$39.2

N.A.

 

Revenue Total=

$44.2

N.A.

Virginia

Increased cap on existing Research and Development tax credit by $1 million. Created a new Research and Development tax credit for firms with R&D spending over $5 million annually, capped at $20 million a year. Increased the overall cap on credits from $6 million to $27 million per year. This tax credit applies to both personal and corporate income tax.

$0.0

-$21.0

 

Provision expired on July 1, 2016 that permits persons with an economic interest in coal to redeem VA Coal Employment and Production Incentive Tax Credits in excess of tax liability. 

$0.9

$1.6

 

Enacted a sales tax exemption for solar and wind energy equipment used by public service corps.

Unknown negative

Unknown negative

 

Tax Revenue=

$0.9

-$19.4

 

Raised the annual sales threshold from $2.5 million to $10 million in FY 2017 and to $25 million in FY 2018. The revenue loss in each year is one time in nature, reflecting the shifting of tax revenues from June of a given fiscal year into July of the next year.

-$36.7

-$27.0

 

Enhanced sales tax review by introducing additional compliance measures in the Department of Taxation focusing on invalid sales and use tax exemption certificates related to sales tax on tobacco products.

$0.4

$1.5

 

Enhanced personal income tax refund review by introducing additional compliance measures in the Department of Taxation aimed at preventing personal income tax fraud.

$3.2

$5.2

 

See Appendix D for property tax actions.

 

 

Virginia, continued

Non-Tax Revenue=

-$33.1

-$20.3

 

Revenue Total=

-$32.2

-$39.7

Washington

Expanded a business and occupation tax deduction for amounts received for providing chemical dependency services under a government-funded program. Previously this deduction only applied to metal health services. This measure is set to expire on Jan. 1, 2020.

-$1.9

-$2.3

 

Tax Revenue=

-$1.9

-$2.3

 

Revenue Total=

-$1.9

-$2.3

West Virginia

Enacted a firearms training tax credit, which is a new non-tax specific tax preference not to exceed $50 dollars, available to any person who pays fees for training or applications.

-$1.0

-$1.5

 

Extended the Neighborhood Investment Tax Credit. The tax credit will now expire on July 1, 2021. No change in taxpayer liability.

Minimal**

-$3.0**

 

Conformed to federal tax code by updating the meaning of federal taxable income and certain other terms used in West Virginia Personal Income Tax, including updating Section 179 to make benefits permanent and provide for a bonus depreciation extension.

-$13.0

-$5.0

 

Updated the meaning of federal taxable income and extended bonus depreciation.

-$27.0

-$10.0

 

Legalized the sale of fireworks and enacted a 6 percent sales tax on firework sales.

$0.9

$0.9

 

Eliminated the sales tax exemption of durable medical equipment purchased by health care providers. This is a temporary change which sunsets on June 30, 2018.

$14.0

$14.0

 

Increased cigarette tax by 65 cents per pack, from 55 cents per pack to $1.20 per pack.

$92.4

$90.4

 

Increased tax on alternative tobacco products by 5 percent from 7 percent of the wholesale price to 12 percent of the wholesale price.

$4.7

$4.7

 

Enacted a tax on e-cigarettes. The new tax is imposed on the sales of e-cigarette liquid at a rate of 7.5 cents per milliliter.

$1.4

$1.8

 

Increased the gross receipts tax on eligible acute care hospitals from 0.72 percent to 0.74 percent. This tax is set to sunset on June 30, 2017.

$15.0

$5.0

 

Eliminated the 5 percent behavioral health severance tax and business privilege tax imposed on health care service providers.

-$16.0

-$16.0

 

Enacted a 12 percent safety tax on all retail sales of newly legalized fireworks.

$2.2

$2.2

 

Eliminated the Moor Fuel Tax for the railroad industry. The full effect of this credit will not be experienced until FY 2019 due to the timing of returns. Annual revenue impact for this credit is estimated to be a decrease of $4.3 million in the out years.

$0.0

-$1.0

West Virginia, continued

Tax Revenue=

$73.6

$85.5

 

Revenue Total=

$73.6

$85.5

Wisconsin

Adopted federal alternative minimum tax exemption amounts and indexing provisions. This measure was enacted in 2015.

-$6.0

-$25.4

 

Increased the standard deduction for married filers. This measure was enacted in 2015.

-$20.9

-$20.9

 

The fiscal impact of a 100 percent exclusion for capital gains on certain Wisconsin-based assets purchased after Dec. 31, 2010 and held for five years began to take effect. This was passed in the 2011 budget bill and the estimated cost will increase to $79.4 million annually beginning 2020-21.

-$6.0

-$22.8

 

Completed the four-year phase-in of the Manufacturing Agricultural Credit (MAC), which is equal to 7.5 percent of Wisconsin-based manufacturing and agricultural income beginning tax year 2016.

-$205.8

-$205.8

 

Consolidated business tax credits. This measure was enacted in 2015.

$5.8

$0.8

 

Sunset the electronic medical records tax credit for tax years beginning on or after Jan. 1, 2014. The sunset was enacted in 2013.

$7.5

$7.5

 

Created a sales tax exemption for construction materials purchased by contractors and used in construction projects for certain tax-exempt entities. This measure was enacted in 2015.

-$3.2

-$3.2

 

Tax Revenue=

-$228.6

-$269.8

 

Increased state park and forest admission and trail fees from $25 to $28.

$1.4

$1.4

 

Increased state park and forest camping fees.

$2.8

$2.9

 

Non-Tax Revenue=

$4.3

$4.3

 

Revenue Total=

-$224.3

-$265.5

Wyoming

Enacted legislation establishing a private hospital assessment.

$4.6

$4.6

 

Tax Revenue=

$4.6

$4.6

 

Revenue Total=

$4.6

$4.6

**not reflected in totals.

Appendix A.2016 Tax and Revenue Changes by Type

 

This appendix shows by type the tax and revenue changes that took place in 2016 regular and special legislative sessions—and in the November 2016 general election—that will affect state revenues in FY 2017 (for most states July 1, 2016, to June 30, 2017) and FY 2018 (for most states July 1, 2017, to June 30, 2018). Tax changes by state appear in Appendix E.

Changes effective in a certain fiscal year as a result of legislation passed in an earlier year are noted by **. This appendix does not include changes in unemployment compensation taxes, nor does it include state-mandated reductions in local property tax rates.

The following abbreviations are used:

AGI = Adjusted Gross Income

ARRA = American Recovery and Reinvestment Act

IRC = Internal Revenue Code

B&O = Business and Occupation

LLC = Limited Liability Corporation

CAT = Commercial Activity Tax

LLP = Limited Liability Partnership

CCRC = Continuing Care Retirement Communities

R&D = Research and Development

CPI = Consumer Price Index

REIT = Real Estate Investment Trust

EITC = Earned Income Tax Credits

GRF = General Revenue Fund

SSTP = Streamlined Sales Tax Project

TY = Tax Year

 

 

Appendix F: Personal Income Tax

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Alabama

Created an income tax credit for contributions to health savings accounts (-$2.7 million beginning in FY 2019).

$0.0

$0.0

1/1/2018

Arizona

Increased the maximum amount claimed as a tax credit for contributions to charitable organizations.

-$2.6

$0.0

1/1/2016

 

Extended due date to claim tax credit for contributions to charitable organizations until the 15th day of the fourth month following the close of the taxable year (which would be April 15 for most taxpayers).

-$1.7

$0.0

1/1/2016

 

Increased the state individual income tax deduction from 10 percent to 100 percent of the amount allowed for federal bonus depreciation over two years.

-$8.0

-$8.0

1/1/2016

California

Enacted Proposition 55, extending for 12 years the temporary personal income tax increases enacted in 2012 on earning over $250,000 (for single filers; over $500,000 for joint filers; over $340,000 for heads of household). Extension will not take effect until tax year 2019. No change in taxpayer liability.

N.A.**

N.A.**

11/8/2016

Connecticut

Postponed the sunset of the Angel Investor Tax Credit to July 1, 2019. No change in taxpayer liability.

-$3.0**

-$3.0**

2/23/2016

Georgia

Conformed to the federal tax code by enacting an exclusion for discharged home mortgage debt.

-$9.1

-$0.8

2/23/2016

 

Conformed to the federal tax code by adopting mortgage insurance premiums as a deductible.

-$4.8

-$0.5

2/23/2016

 

Conformed to the federal tax code by updating other miscellaneous items less than $5 per year.

-$19.7

$12.9

5/3/2016

 

Adopted an income deduction for contribution to college savings plans for married taxpayers filing jointly.

-$2.0

-$2.3

1/1/2017

 

Enacted personal tax credits for contributions to "rural hospital organizations" and "critical access hospitals."

-$25.0

-$55.0

1/1/2016

 

Enacted personal tax credits for land donated to the state for conservation use. These credits are set to expire on Dec. 31, 2021.

-$17.2

-$17.2

2/23/2016

Hawaii

Adopted an organic food production credit. The credit is set to sunset on Dec. 31, 2021.

-$2.0

-$2.0

1/1/2017

 

Adopted a renewable fuels income tax credit. The credit is set to sunset on Dec. 31, 2021.

-$3.0

-$3.0

1/1/2017

Idaho

Conformed personal income taxes to the federal tax code.

-$28.7

-$28.7

7/1/2016

Indiana

Phased in rate reduction of the individual income tax from 3.4 percent in TY 2014 to 3.23 percent in TY 2017. Changed rate from 3.4 percent to 3.3 percent in TY 2015 and TY 2016 and 3.23 percent in years after that. Original legislation enacted in 2013 legislative session.

-$197.4

-$270.3

The new phased down rate is effective at the beginning of each tax year.

 

Conformed personal income taxes to the federal tax code.

-$15.4

-$12.2

1/1/2016

 

Expanded eligibility for dependent exemption, effective Jan. 1, 2018.

-$0.0

-$0.0

1/1/2018

Iowa

Conformed personal income taxes to the federal tax code for TY 2015 only.

$23.0

$0.0

TY 2015

 

Extended the solar energy tax credit. The credit now expires after TY 2021.

$0.0

-$2.5

TY 2016

 

Enacted a new version of the Geothermal Energy tax credit.

$0.0

-$1.5

1/1/2017

Louisiana

Permanently reduced the Citizens Assessment credit to 25 percent of the assessment paid on insurance policies. The credit is already reduced to 72 percent through FY 2018, then was scheduled to return to 100 percent after that.

$17.0

$21.2

N.A.

 

Imposed a minimum five-year in-state domiciled requirement before gains from a sale of controlling interest in a business qualified for a deduction from taxable income. The minimum deduction is 50 percent of the gains, climbing to 100 percent of the gain if held for 30 years or more.

Increase

Increase

N.A.

Maine

Partially conformed personal income taxes to the federal tax code.

-$12.7

-$6.3

3/10/16 for tax years beginning on or after 1/1/15

 

Expanded the educational opportunity income tax credit, which is a credit for repayment of student loans.

-$0.4

-$1.0

4/16/16 for tax years beginning on or after 1/1/16

 

At the 2016 general election, voters enacted a 3 percent surcharge on taxable income of $200,000 beginning with tax years on or after January 1, 2017. Revenue from this tax will be placed in the Fund to Advance Public Kindergarten to Grade 12 Education. This fund was established for the purpose of improving the ability of the state to reach the annual target of 55 percent for the state share of funding K-12 public education.

 

$43.8

$150.4

Maryland

Adopted a refundable credit for up to $5,000 for qualified student loan debt.

$0.0

-$5.0

07/01/16    

Massachusetts

Adopted an Earned Income Tax Credit.

-$74.0

N.A.

1/1/2016

 

Reduction of income tax rate by 0.05 percent, from 5.15 percent to 5.10 percent effective Jan. 1, 2016. This is part of a larger reform in which the rate is scheduled to be gradually reduced by 0.05 percent increments contingent on baseline tax revenue growth. The trigger was not met for a reduction in 2017.

-$152.0

-$152.0

1/1/2016

Minnesota

Enacted a Military Pension Subtraction.

-$22.6

-$23.7

1/1/2016

 

Extended the Small Business Investment Tax Credit for one additional year. No change in taxpayer liability.

$0.0**

-$10.0**

1/1/2017

Mississippi

Enacted the Taxpayer Pay Raise Act of 2016.  This bill phases out personal income tax on the first $5,000 of taxable income over a five-year period beginning in CY 2018. Changes from three percent on the first $5,000 of taxable income to 0 percent on the first $5,000 of taxable income once the five-year phase-in is complete. This is part of a larger reform measure which also phases out the franchise tax, phases out the 3 percent rate on corporate income, and provides a self-employment tax deduction.

$0.0

-$14.4

1/1/2016

Missouri

Continued a phase-in an income tax reduction of top bracket to 5.5 percent from 6 percent by 0.1 percent increments annually. Continued phase-in of a 25 percent deduction of business income by 5 percent increments annually. Increased personal exemption by $500 for Missouri adjusted gross incomes less than $20,000. Adjusts brackets for inflation annually. This legislation was originally enacted in 2014.

-$72.5

-$145.7

1/1/2017

 

Enacted an exemption for payments from agricultural disaster programs.

-$12.0

N.A.

1/1/2014

 

Adopted an exemption for income from individuals in the active duty military service.

-$3.0

-$3.6

1/1/2016

 

Allowed for a 50 percent deduction for costs related to business relocation to Missouri and expanded Brownfield tax credit

-$0.8

-$6.0

1/1/2016 for deduction and 7/1/2017 for Brownfield tax credit

Montana

Implemented previously enacted tax credits for contributions to public and private schools. This change was made by a departmental ruling on a bill from the 2015 legislative session; the Montana Legislature did not convene in 2016.        

$2.8

$2.8

1/1/2016

Nebraska

Enacted a school readiness tax credit.

$0.0

-$0.9

1/1/2017

New Jersey

Enacted a personal income tax exemption of $3,000 for veterans.

$0.0

-$23.0

1/1/2017

 

Increased the earned income tax credit from 30 percent to 35 percent of the federal credit.

-$62.0

-$63.5

1/1/2016

 

Enacted legislation to increase annually, in equal installments, the exclusion of pension income from $20,000 (married filing joint) to $100,000 in tax year 2020.

$0.0

-$75.0

1/1/2017

New Mexico

Extended and amended the Sustainable Building Tax Credit against the personal and corporate income tax. Extended the credit beyond current sunset of Dec. 31, 2016 to Dec. 31, 2026. This legislation was originally enacted in 2015. No change in taxpayer liability.

$5.0**

$5.0**

1/1/2017

New York

Enacted legislation that will provide middle class taxpayers with a permanent 20 percent rate reduction over eight years. Changed rate from 6.85 percent to 5.5 percent and 6 percent. Fiscal impact is $4.2 billion annually when fully effective.

$0.0

-$236.0

1/1/2018

New York, continued

Eliminated the existing STAR property tax exemption for new applicants and replaced with a refundable tax credit. The reduction in revenue is accompanied by a corresponding savings in spending making this change overall revenue neutral.

-$98.0

-$194.0

1/1/2016

 

Extended for five years the Clean Heating Fuel Tax Credit. To qualify each gallon of clean heating fuel must be at least 6 percent biodiesel. The fiscal impact begins in FY 2019 with a revenue loss of $1 million annually. No change in taxpayer liability.

$0.0**

$0.0**

1/1/2017

 

Enacted legislation to make the non-custodial parent earned income tax credit permanent. The fiscal impact begins in FY 2019 with a revenue loss of $4 million annually.

$0.0

$0.0

1/1/2017

North Carolina

Increased standard deductions by $2,000 over two years ($1,000 increase for each year) to a new limit of $17,500.

-$145.0

-$205.0

1/1/2016

Oklahoma

Placed a cap on the Investment/New Jobs tax credit. This cap is set to expire Dec. 31, 2018. This change affects both personal and corporate income tax revenues.

$2.0

N.A.

11/1/2016

 

Enacted legislation that makes the state earned income tax credit non-refundable for all tax years after Jan. 1, 2016.

$24.8

N.A.

11/1/2016

 

Enacted legislation to elimination the "Double Deduction" and require state and local income or sales taxes included in itemized deductions be added back to calculate Oklahoma taxable income (by subtracting them from itemized deductions. Effective for TY 2016.

$83.3

N.A.

1/1/2016

Oregon

Expanded the earned income tax credit. The new rate applies only to taxpayers with dependents 2 years old or younger. Increased from 8 percent of federal credit to 11 percent of federal credit. The entire credit is set to sunset on Jan. 1, 2020.

$0.0

-$5.0

1/1/2017

 

Increased the annual cap for the film and video tax credit from $10 million to $14 million. The entire credit is set to sunset on Jan. 1, 2022.

-$1.8

-$4.0

1/1/2016

Pennsylvania

Expanded the tax base to include Pennsylvania Lottery winnings on cash prizes. Non-cash prizes of Pennsylvania Lottery remain exempt.

$15.8

$13.6

1/1/2016

Rhode Island

Exempted first $15,000 of pension income, with qualifications.

-$6.3

-$13.0

1/1/2017

 

Increased the earned income tax credit to 15 percent of federal rate. The previous rate was 12.5 percent.

-$2.7

-$5.5

1/1/2017

South Carolina

Conformed personal income taxes to the federal tax code.

-$7.8

N.A. 

4/21/2016

 

Adopted an income tax credit for qualified new jobs in the agricultural packaging industry. The credit varies based upon county designation.

N.A.

-$1.5

6/8/2016

 

Adopted an income tax deduction for military retirement benefits attributable to active duty service. Deduction is equal up to $17,500 of earned income for taxpayers under age 65.

-$6.5

-$9.9

1/1/2016

 

Adopted an income tax deduction for the construction, purchasing or leasing of qualified solar energy property. May not exceed $2.5 million for all taxpayers. The deduction is set to expire on Dec. 31, 2017.

-$2.5

-$2.5

1/1/2016

 

Adopted an income tax credit for 25 percent of the cost of purchase and installation of certain geothermal machinery and equipment. The credit may not exceed $3,500 for each facility. This credit is set to expire on Jan. 1, 2019.

-$1.0

-$1.0

1/1/2016

Tennessee

Established a tax credit against the Hall Income Tax equal to 33 percent of the value of an investment by an angel investor, if certain conditions apply.

-$1.9

-$2.6

1/1/2017

 

Enacted a reform measure that will eliminate the income tax over six years. It decreased the Hall Income Tax (HIT) rate from 6 percent to 5 percent for tax years beginning on or after Jan. 1, 2016. Also, established the legislative intent that the HIT be reduced by 1 percent annually through further enactments of general bills. The tax will be eliminated completely in tax year 2022 and beyond, for a revenue loss of $166.3 million annually.

-$27.7

-$27.7

1/1/2016

Wisconsin

Adopted federal alternative minimum tax exemption amounts and indexing provisions. This measure was enacted in 2015.

-$6.0

-$25.4

1/1/2017

 

Increased the standard deduction for married filers. This measure was enacted in 2015.

-$20.9

-$20.9

1/1/2016

 

The fiscal impact of a 100 percent exclusion for capital gains on certain Wisconsin-based assets purchased after Dec. 31, 2010 and held for five years began to take effect. This was passed in the 2011 budget bill and the estimated cost will increase to $79.4 million annually beginning 2020-21.

-$6.0

-$22.8

1/1/2011

West Virginia

Enacted a firearms training tax credit which is a new non-tax specific tax preference not to exceed $50 dollars, available to any person who pays fees for training or applications.

-$1.0

-$1.5

1/1/2016

 

Extended the Neighborhood Investment Tax Credit. The tax credit will now expire on July 1, 2021. No change in taxpayer liability.

Minimal**

-$3.0**

7/1/2016

 

 

Appendix F: Corporate Income Tax and Gross Receipts Taxes

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Alabama

Enacted a port tax credit for increased use of state port facilities capped at $5 million a year. The credit is not to exceed $12 million for the life of the program.

-$5.0

-$5.0

10/1/2016

 

Created a Growing Alabama tax credit for cash donations to an approved local economic development organization. The credit is not to exceed 50 percent of current year tax liability of taxpayer (corporate and individual combined). The credit is set to expire on Sept. 30, 2020.

-$10.0

-$10.0

6/19/2016

 

Adopted an apprenticeship tax credit of $1,000 for each apprentice employed. The credit is capped annually at $3 million (also applies to financial institution excise tax) and is set to expire on Dec. 31, 2021.

$0.0

-$3.0

1/1/2017

California

Reduced income-related taxes on certain health plans. Specified income excluded from gross income for purposes of corporate income taxation. This is part of state's Managed Care Organization (MCO) tax package, passed during special session in early 2016. This reduction is set to expire on June 30, 2019.

-$90.0

-$90.0

7/1/2016 

Colorado

Extended the number of years, from two to five, in which the Colorado Housing and Finance Authority (CHFA) may allocate low-income housing income tax credits for the development of low-income housing. The bill decreases revenue by a total of $90 million spread out over 12 tax years. The program is set to expire on Jan. 1, 2020. No change in taxpayer liability.

$0.0**

-$1.5**

TY 2017

Delaware

Adopted a change in income apportionment calculation.

-$8.2

-$17.6

12/31/2016

 

Enacted a tax credit for research and development.

$0.0

-$3.5

12/31/2016

Florida

Conformed with federal tax code. Adopted Section 179 Expending Internal Revenue Code.

-$3.2

-$1.5

1/10/2016 (Retroactive)

Georgia

Enacted corporate tax credits for contributions to "rural hospital organizations" and "critical access hospitals."

N.A.

N.A.

N.A.

 

Enacted corporate tax credits for land donated to the state for conservation use. These credits are set to expire on Dec. 31, 2021.

N.A.

N.A.

N.A.

 

Conformed to federal tax code by updating research tax credit.

-$43.1

-$45.5

2/23/2016

 

Conformed to federal tax code by updating limitation in Section 179 to $500,000, expensing made permanent.

-$46.2

-$28.9

2/23/2016

Indiana

Phased in reduction of corporate income tax from 8.5 percent in FY 2012 to 6.5 percent in FY 2016, originally adopted in the 2011 legislative session. In the 2014 session, the corporate income tax rate was further phased down from 6.5 percent in FY 2016 to 4.9 percent in FY 2022 and thereafter. The rate for FY 2017 is 6.25 percent to be phased down to 6.0 percent in FY 2018.

-$167.6

-$193.5

The new phased down rate is effective at the beginning of each fiscal year.

 

Phased in reduction of financial institution tax (FIT) from 8.5 percent in calendar year (CY) 2013 to 6.5 percent in CY 2017. The original legislation was adopted in the 2013 session and the law also changed the distributions of the FIT revenues. In 2014 Session, the FIT rate was further phased down from 6.5 percent in CY 2018 to 4.9 percent in CY 2023 and thereafter. The rate for CY 2017 and CY 2018 will be 6.5 percent.

-$32.3

-$26.3

The new phased down rate is effective at the beginning of each calendar year.

 

Expanded the eligibility for the Industrial Recovery tax credit.

$0.0

-$1.7

1/1/2017

 

Extended the Venture Capital Investment tax credit to Dec. 31, 2020. No change in taxpayer liability.

N.A.**

-$5.4**

1/1/2015

 

Extended the Hoosier Business Investment tax credit to Dec. 31, 2020. No change in taxpayer liability.

N.A.**

-$8.9**

1/1/2015

Iowa

Enacted a renewable chemical tax credit. The negative revenue impact begins FY 2019 with an expected net revenue of -$92.5 million between FY 2019 and FY 2031. This credit is offset by reductions in other tax credits.

$0.0

$0.0

7/1/2019

Louisiana

Expanded the corporate franchise tax to other forms of business organizations other than traditional C-corporations. The bill also provided an exception for subsidiaries of S-corps purchased between Jan. 1, 2012 and Jan. 1, 2014.

$10.3

$89.3

1/1/2017

 

Imposed various limitations to the Enterprise Zone Program, with accumulating state revenue gains as program costs are diminished.

$0.0

$2.0

03/10/2016

 

Modified the refundability of inventory credit by establishing a tiered structure that effectively reduces the aggregate amount of credit that is refundable in excess of offsetting tax liabilities. Credit Balances not refundable are allowed a five-year carry-forward against future tax liabilities. Applicable to all tax returns filed on and after July 1, 2016.

$17.3

$17.3

N.A.

Louisiana, continued

Modified the refundability of inventory credit available to manufacturers with ad valorem industrial tax exemption benefits. Credit available in excess of tax liabilities are not to be refunded, but are allowed a five-year carry-forward against future tax liabilities. Applicable to all tax returns filed on and after July 1, 2016.

$57.0

$57.0

N.A.

Maine

Partially conformed corporate taxes to the federal tax code.

-$6.7

-$6.4

4/16/16 for tax years beginning on or after 1/1/16

 

Maryland

Enacted a credit for businesses operating a qualifying aerospace, electronics or defense contract tax credit project. The credit is equal to $250 per qualified employee, subject to a $2.5 million maximum value per project. The credit is set to expire on June 30, 2021.

-$7.5

-$7.5

7/1/2016

 

Altered and extended the Heritage Structure Rehabilitation Tax Credit. This tax credit is now set to expire on July 1, 2022.

$0.0

-$9.3

6/1/2016

Michigan

Repealed the Insurance Tax Credit.

$80.0

$80.0

7/13/2016

Mississippi

Enacted the Taxpayer Pay Raise Act of 2016.  This bill phases out corporate income tax on the first $5,000 of taxable income over a five-year period beginning in CY 2018. Changes rate from 3 percent on the first $5,000 of taxable income to 0 percent on the first $5,000 of taxable income once the five-year phase-in is complete.

$0.0

-$0.2

1/1/2016

 

Enacted the Taxpayer Pay Raise Act of 2016.  This legislation phases out Franchise Tax over a 10-year period. The phase out begins in CY 2019.

$0.0

$0.0

1/1/2016

 

Enacted the Taxpayer Pay Raise Act of 2016.  This legislation provides a self-employment tax deduction beginning in calendar year 2017.  This deduction is based on self-employment taxes imposed and will be implemented as follows: 17 percent of federal self-employment taxes imposed for taxable years ending in CY 2017; 34 percent of federal self-employment taxes imposed for taxable years ending in CY 2018; and 50 percent of federal self-employment taxes imposed for taxable years ending in CY 2019 and thereafter.

$0.0

-$3.4

1/1/2016

Mississippi, continued

Provided a tax credit for inventory taxes paid.  This is phased in over a four-year period beginning in FY 2014.  FY 2014 -$7 million, FY 2015 -$14 million, FY 2016 -$21 million and FY2017 -$126 million. These figures represent the cumulative loss in revenue per Department of Revenue. Originally enacted during the 2012 regular session.

-$84.0

$0.0

7/1/2013

Nevada

Restructured the modified business tax—general business (general businesses exclude financial and mining businesses), which was scheduled to sunset. The tax rate went up from 1.17 percent to 1.475 percent and the exemption for taxable wages was decreased from $85,000 to $50,000 per quarter. The legislation also removed mining businesses from the tax base. No change in taxpayer liability.

$281.4**

N.A.

7/1/2015

 

Restructured the modified business tax on mining businesses so that they are required to pay the net proceeds of mineral tax instead of the modified business tax on general business. Under the new provisions, all quarterly taxable wages are taxed at 2.0 percent. No change in taxpayer liability.

$6.5**

N.A.

7/1/2015

 

Approved a commerce tax on the gross revenue of each business entity whose Nevada gross revenue exceeds $4 million in a fiscal year. There are 26 different rates based on different industry codes, ranging from 0.051 percent to 0.331 percent. No change in taxpayer liability.

$119.8**

N.A.

7/1/2015

 

Approved a new commerce tax credit, which is allowed against the modified business tax due during the fiscal year not to exceed 50 percent of the commerce tax paid for the preceding fiscal year. No change in taxpayer liability.

-$59.3**

N.A.

7/1/2016

New Hampshire

Decreased Business Profits Tax rate from 8.5 percent to 8.2 percent.

-$12.0

-$14.9

1/1/2016

 

Decreased Business Enterprise tax rate from 0.75 percent to 0.72 percent.

-$9.1

-$12.4

1/1/2016

 

Increased Research and Development tax credit from $2 million aggregate to $7 million aggregate.

$0.0

$0.0

7/1/2017

New Jersey

Increased cap on Economic Redevelopment and Growth tax credits by $90 million.

N.A.

N.A.

9/7/2016

New Mexico

Extended and amended the Sustainable Building Tax Credit against the personal and corporate income tax. Extended the credit beyond current sunset of Dec. 31, 2016 to Dec. 31, 2026. This legislation was originally enacted in 2015. No change in taxpayer liability.

$5.0**

$5.0**

7/1/2016

New Mexico, continued

Reduced corporate income tax rate from 4.8-7.6 percent to 4.8-5.9 percent.

-$70.5

-$70.5

7/1/2016

New York

Created the Farm Workforce Retention Credit, which allows farm employers to claim a refundable tax credit for each farm employee.  The purpose is to offset the impact of the minimum wage increase. The fiscal impact begins in FY 2019 with a revenue loss of $15 million and a revenue loss of $37 million in FY 2023.

$0.0

$0.0

1/1/2017

 

Extended the Hire-A-Vet tax credit for two years. The fiscal impact takes effect in 2019 and 2020 with a revenue loss of $37 million for these years. This measure is now set to expire on Dec. 31, 2018. No change in taxpayer liability.

$0.0**

$0.0**

1/1/2017

 

Authorized an additional $8 million in low-income housing credits to be allocated in FY 2017 through March 31, 2021.

$0.0

-$8.0

1/1/2017

 

Authorized an additional $30 million of tax credits for Urban Youth Tax Credits allocated in tax years 2016 and 2017. Extended the eligibility to non-metro areas. No change in taxpayer liability.

$0.0

-$30.0

1/1/2016

 

Extended the Empire State Commercial Production Tax Credit for two years. The fiscal impact will take effect in FY 2019 and FY 2020, resulting in a revenue loss of $7 million for these years. The tax credit is now set to expire on Dec. 31, 2018.

$0.0**

$0.0**

1/1/2017

 

Made the Special Additional Mortgage Recording Tax refundable under corporate franchise tax for all taxpayers. Part of the technical cleanup from 2014 corporate tax reform.

-$15.0

-$15.0

Retroactive to 01/01/15

 

Extended the credit for purchasing or upgrading a for-hire vehicle for use by disabled individuals through 2022. The fiscal impact begins in FY 2019 and will result in a $5 million annual revenue loss. The credit is now set to expire on Dec. 31, 2022. No change in taxpayer liability.

$0.0**

$0.0**

1/1/2017

 

Expanded eligibility for Economic Transformation and Revitalization Program credits to psych centers.

$0.0

-$2.0

4/13/2016

North Carolina

Reduced corporate income tax rate from 4 percent to 3 percent as a result of legislation passed in 2015 that created a trigger for a 1 percent reduction in the corporate income tax the following tax year when the amount of net General Fund tax collected in a fiscal year exceeded $20,975,000.

N.A.

N.A.

1/1/2017

North Dakota

Continued phase-in of an alternate income apportionment method (single sales factor) for calculating the corporate income tax.

-$7.5

-$25.0

1/1/2015

Ohio

Enhanced the motion picture tax credit.

-$20.0

-$20.0

7/1/2016

Oklahoma

Placed a cap on the Investment/New Jobs tax credit. This cap is set to expire Dec. 31, 2018. This change affects both personal and corporate income tax revenues.

$9.1

N.A.

11/1/2016

Oregon

Modified and extended the corporate income tax credit for biomass production. Decreased the credit from $5 per wet ton to $3.50 per wet ton. The entire credit is set to sunset on Jan. 1, 2022.

$1.6

-$4.3

1/1/2016

Rhode Island

Reduced the annual corporate minimum tax. This is the second consecutive budget to reduce minimum tax. The old minimum was $450; the new minimum is $400.

-$1.6

-$3.2

1/1/2017

Tennessee

Expanded the minimum requirement for a business to be considered a qualified data center for the purpose of being exempt from the sales and use tax on cooling equipment or backup power infrastructure. The minimum number of jobs required to be created decreased from 25 to 15, and the minimum capital investment required to be made decreased from $250 million to $100 million.

-$4.1

-$4.1

7/1/2016

Utah

Amended the corporate franchise and income tax. This offers computer and computer product manufacturers the option of filing their corporate return using either single sales, double weighted sales, or the three-factor formula.

-$2.6

-$2.8

1/1/2016

Virginia

Increased cap on existing Research and Development tax credit by $1 million. Created a new Research and Development tax credit for firms with R&D spending over $5 million annually, capped at $20 million a year. Increased the overall cap on credits from $6 million to $27 million per year. This tax credit applies to both personal and corporate income tax.

$0.0

-$21.0

1/1/2016

 

Provision expired on July 1, 2016 that permits persons with an economic interest in coal to redeem VA Coal Employment and Production Incentive Tax Credits in excess of tax liability. 

$0.9

$1.6

 N.A.

Washington

Expanded a business and occupation tax deduction for amounts received for providing chemical dependency services under a government-funded program. Previously this deduction only applied to metal health services. This measure is set to expire on Jan. 1, 2020.

-$1.9

-$2.3

4/1/2016

West Virginia

Updated the meaning of federal taxable income and extended bonus depreciation.

-$27.0

-$10.0

1/1/2016

Wisconsin

Completed the four-year phase-in of the Manufacturing Agricultural Credit (MAC), which is equal to 7.5 percent of Wisconsin-based manufacturing and agricultural income beginning tax year 2016.

-$205.8

-$205.8

1/1/2016

 

Consolidated business tax credits. This measure was enacted in 2015.

$5.8

$0.8

1/1/2016

 

Sunset the electronic medical records tax credit for tax years beginning on or after Jan. 1, 2014. The sunset was enacted in 2013.

$7.5

$7.5

1/1/2014

 

 

 

 

Appendix F: Sales and Use Taxes

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Arizona

Adopted a sales tax exemption on agricultural feed used in non-commercial boarding of livestock.

-$1.0

$0.0

8/6/2016

 

Adopted a sales tax exemption on aircraft and aircraft equipment operated by charter airlines.

$0.0

-$2.3

7/1/2017

 

Adopted a sales tax exemption on fine art purchased by nonresidents at an auction or a gallery in the state, for use outside the state.

-$1.3

$0.0

9/1/2016

 

Modified the existing sales tax exemption on electricity and natural gas sold to manufacturers and smelters.

-$7.0

-$7.0

1/1/2017

California

Enacted Proposition 64, exempting certain sales of medical marijuana from state sales tax. Passed as part of Proposition 64 legalizing recreational marijuana.

-$30.0

$30.0

11/8/2016

Connecticut

Adopted a sales tax exemption for feminine hygiene products and disposable or reusable (non-adult) diapers. This exemption removes approximately $7.8 million from the tax base beginning on July 1, 2018.

$0.0

-$7.8

7/1/2018

Florida

Enacted a phase-out of the asphalt tax.

-$0.5

-$1.0

7/1/2016

 

Enacted a sales tax exemption for certain sales by Veteran Service Organizations.

-$1.2

-$1.4

7/1/2016

 

Adopted a Back-to-School sales tax holiday for calendar year 2016.

-$22.9

-$0.0

7/1/2016

 

Expanded the medical use of cannabis.

$1.5

$3.1

3/25/2016

 

Enacted a sales tax exemption for metal recyclers.

-$1.7

-$1.8

7/1/2016

 

Enacted a permanent sales tax exemption for manufacturing machinery and equipment.

-$0.0

-$62.8

7/1/2016

Georgia

Extended sales tax exemption for construction of competitive projects of regional significance. The exemption is now set to expire on June 30, 2019. No change in taxpayer liability.

-$4.3**

-$8.6**

7/1/2016

 

Created a sales tax exemption on admission to non-recurring major sporting events. This is expected to generate at least $50 million in state revenue. The tax exemption is set to expire on Dec. 31, 2022.

-$0.9

-$2.6

7/1/2016

 

Adopted a sales tax holiday on energy efficient products. The tax holiday was valid from Sept. 30, 2016 to Oct. 2, 2016.

-$1.0

$0.0

9/30/2016

 

Adopted a Back-to-School sales tax holiday on July 30, 2016.

-$42.0

$0.0

7/30/2016

Indiana

Enacted a requirement that contractors collect sales tax on the retail price of construction materials under time and materials contracts. This change reverses a tax court decision that would have required the Department of Revenue to issue refunds. Previously, use tax was due on the wholesale price of these construction materials.

$7.9

$7.9

1/1/2010 (retroactive)

 

Enacted a requirement that a person who rents rooms in a house, condo or apartment for less than 30 days must collect sales tax.

Indeterminate, but a potentially significant increase

Indeterminate, but a potentially significant increase

7/1/2017

 

Adopted a sales tax exemption for legal tender, coins and bullion.

-$1.5

-$1.5

7/1/2016

Iowa

Expanded the definition of sales tax exempt manufacturing consumables.

-$21.3

-$22.4

7/1/2016

Louisiana

Increased the state sales tax rate by 1 percent on the traditional base of transactions. It also subjected various formerly exempt transactions to the new levy. This tax increase is set to expire on June 30, 2018.

$880.6

$880.6

4/1/2016

 

Passed legislation which subjects formerly exempt transactions to the state sales tax. This measure is set to expire on June 30, 2018.

$272.3

$272.3

4/1/2016

 

Capped vendor compensation to dealers remitting state sales tax at $1,500 per month ($18,000 per year), and compensation is only allowed on the original 4 percent sales tax rate.

$14.6

$14.6

4/1/2016

 

Expanded the definition of hotel to include establishments with any number of rooms including residential locations furnished to transient guests. The receipts are received by the general sales tax, but are generally dedicated to the local area from which they are generated.

Increase

Increase

7/1/2016

 

Renewed a 1 percent state sales tax on interstate telecommunications services. No change in taxpayer liability.

$3.4**

$3.4**

4/1/2016

Maine

Adopted a sales tax exemption for fuel used in commercial agriculture, aquaculture, fishing and wood harvesting.

-$3.5

-$10.0

1/1/2017

 

Legalized possession and use of marijuana by a person 21 years of age or older. The bill places a sales tax of 10 percent on retail marijuana and retail marijuana products.

$2.7

$10.5

11/8/2016

Maryland

Enacted a sales tax exemption for construction material or warehousing equipment purchased for use in certain qualified redevelopment projects. This exemption is set to expire on Sept. 30, 2026.

-$1.0

Indeterminate, but revenue decrease is assumed to exceed $1.0 million annually

10/1/2016

Michigan

Reduced the state use tax in order to create a local use tax. This measure is part of a personal property tax reform package adopted in 2012 to reimburse local units for revenue. The combined state and local tax rate remains at 6 percent.

-$380.9

-$410.8

10/1/2015 (legislation adopted in 2012)

Minnesota

Altered the sales tax on modular homes to 6.5 percent of the invoice price.

-$1.0

-$1.1

6/30/2016

Mississippi

Clarified that certain sales to schools under federal programs are exempt and revised the exemption for durable medical equipment.

N.A.

N.A.

7/1/2016

Missouri

Amended the Missouri Constitution to prohibit a new state or local sales/use or other similar tax on any service or transaction. This amendment only applies to any service or transaction that was not subject to a sales/use or similar tax as of Jan. 1, 2015.

$0.0

$0.0

11/8/2016

 

Extended for 10 years the 0.1 percent sales and use tax that is used for soil and water conservation and for state parks and historic sites. This tax will be resubmitted to the voters for approval in 10 years. No change in taxpayer liability.

$90.0**

$90.0**

11/8/2016

Nebraska

Enacted various sales tax exemptions.

-$1.5

-$2.4

4/19/2016

 

Changed provisions of the Convention Center Facility Financing Assistance Act and the Sports Arena Facility Financing Assistance Act and adopted the Affordable Housing Tax Credit Act.

-$1.4

-$3.3

10/1/2016

Nevada

Extended the local school support sales tax increase of 0.35 percent that was scheduled to sunset on June 30, 2015. No change in taxpayer liability.

$193.7**

N.A.

7/1/2015

 

Adopted a ballot measure that will bring the question to vote to add new sections to the Nevada Constitution exempting durable medical equipment, oxygen delivery equipment and mobility enhancing equipment from the sales and use tax when such equipment is prescribed for human use by a licensed health care provider. Needs to be approved in 2018 general election to become law.

N.A.

N.A.

N.A.

New Jersey

Decreased state sales tax rate from 7 percent to 6.875 percent for tax year 2017. This is part one of a two-part phase-in. On Jan. 1, 2018, the state sales tax rate will decrease from 6.875 percent to 6.625 percent as the second part of the phase-in of the new rate.

-$92.4

Out-year fiscal impact unclear

1/1/2017

 

Expiration of the reduced tax rate of 50 percent of taxation in certain urban enterprise zones. The tax rate has returned to 100 percent of the original rate.

$10.0

$19.0

1/1/2017

New York

Enacted a sales tax exemption for the purchase of fuel cells.

-$4.0

-$2.0

6/1/2016

North Carolina

Enacted a sales and use tax exemption on Styrofoam pellets for wastewater system materials.

-$1.0

-$1.0

1/1/2017

 

Repealed a tax on automotive service contracts.

-$1.6

-$3.5

1/1/2017

North Dakota

Exempted sales tax for the sale of internet access services. The tax rate is reduced from 5.0 percent to 0.0 percent.

$0.0

-$10.0

7/1/2017

Ohio

Adopted a sales tax holiday for three days in August 2016.

-$15.1

$0.0

08/05/2016-08/07/2016

 

Enacted a sales tax exemption for sales of natural gas by municipally owned gas company.

-$6.9

-$2.1

Applies retroactively

Pennsylvania

Imposed a sales tax on digital downloads of books, music, photographs, games, audio, apps, canned software, satellite radio, and streaming video and audio

$46.9

$59.2

8/1/2016

 

Exempted the business of producing or harvesting trees for commercial production of wood, paper or energy products from sales tax.

$0.0

-$2.5

7/1/2017

 

Introduced a cap on the current 1 percent vendor discount on timely filed returns. It is now capped at $300 per year or 1 percent of remittance, whichever is smaller. Business with taxable sales of $500,000 or less are not affected.

$55.5

$69.2

8/1/2016

South Carolina

Removed the 5 percent sales tax surcharge on car rentals and heavy equipment rentals.

-$1.9

N.A.

6/6/2016

South Dakota

Increased state sales tax rate by 0.5 percent, from 4 percent to 4.5 percent. This provided additional money for teacher salaries and was offset by a reduction in property taxes. See Appendix D for the revenue impact of the property tax reduction.

$107.0

N.A.

6/1/2016

Virginia

Enacted a sales tax exemption for solar and wind energy equipment used by public service corps.

Unknown negative

Unknown negative

1/1/2017

West Virginia

Legalized the sale of fireworks and enacted a 6 percent sales tax on firework sales.

$0.9

$0.9

6/1/2016

 

Eliminated the sales tax exemption of durable medical equipment purchased by healthcare providers. This is a temporary change which sunsets on June 30, 2018.

$14.0

$14.0

7/1/2016

Wisconsin

Created a sales tax exemption for construction materials purchased by contractors and used in construction projects for certain tax-exempt entities. This measure was enacted in 2015.

-$3.2

-$3.2

1/1/2016

           

 

 

 

Appendix F: Health Care Provider and Industry Taxes

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Alabama

Extended current assessment on private hospitals and changed the base year for calculating the assessment. (If the assessment was not extended, Medicaid would lose $257.5 million based on FY 2015 receipts.) Base year change from FY 2011 to FY 2014. The extension terminates on Sept. 30, 2017. No change in taxpayer liability.

$6.0**

$6.0**

10/1/2016

California

Enacted a tax on certain Managed Care Organization (MCO) providers. The tax consists of various taxing tiers and per enrollee amounts.  The net effect on revenue reflects the sum of gross tax revenue and a reduction for the amount paid back to MCOs through increased MediCal managed care payments. This is part of the MCO tax package and is set to expire on June 30, 2019.

$1,100.0

$1,700.0

7/1/2016

Louisiana

Increased the premium tax on health maintenance organizations from 2.25 percent to 5.5 percent effective for calendar year 2016. Roughly 90 percent of these receipts will be dedicated to the Medical Assistance Trust Fund

$187.0

$124.0

N.A.

 

Exempted health maintenance organizations (HMOs) from the reduction in the investment tax credit against premium tax liabilities that was enacted in Act 10 of 2016 Extraordinary Session 1 for FY 2017 and FY 2018.

-$1.3

-$1.3

N.A.

 

Medicaid expansion increased premium tax collections at the existing 2.25 percent tax rate. These receipts will be dedicated to the Medical Assistance Trust Fund.

$23.8

$59.6

N.A.

 

Medicaid expansion increased premium tax collections as a result of the 3.25 percent tax rate increase on health maintenance organizations from 2.25 percent to 5.5 percent effective for calendar year 2016. These receipts will be dedicated to the Medical Assistance Trust Fund.

$34.5

$86.1

N.A.

Tennessee

Extended the Annual Coverage Assessment Act of 2016, which establishes an annual coverage assessment on hospitals of 4.52 percent of a covered hospital’s annual coverage assessment base and is required to be paid in equal quarterly installments. No change in taxpayer liability                                                  

$449.8**

N.A.

07/01/2016

 

Extended the annual nursing home assessment for an additional year. No change in taxpayer liability.

$121.0**

N.A.

07/01/2016

Vermont

Adopted an ambulance provider tax at a rate of 3.3 percent.

$1.2

N.A.

7/1/2016

West Virginia

Increased the gross receipts tax on eligible acute care hospitals from 0.72 percent to 0.74 percent. This tax is set to sunset on June 30, 2017.

$15.0

$5.0

7/1/2016

West Virginia, continued

Eliminated the 5 percent behavioral health severance tax and business privilege tax imposed on health care service providers.

-$16.0

-$16.0

N.A.

Wyoming

Enacted legislation establishing a private hospital assessment.

$4.6

$4.6

7/1/2016

           
 

 

 

 

Appendix F: Tobacco Taxes

State

Description

 FY2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

California

Enacted Proposition 56, which increased cigarette tax by $2 per pack, with equivalent increases on other tobacco products and electronic cigarettes containing nicotine. This increase is expected to raise $1.4 billion in new revenue in FY 2018. Of this total, it is estimated that $24 million will come from taxes on electronic cigarettes.

$368.0

$1,400.0

4/1/2017

Kansas

Effective date of e-cigarette tax decelerated from July 1, 2016 to Jan. 1, 2017.

$0.0

 

-$1.0

 

7/1/2016

Louisiana

Increased tax on cigarettes by 22 cents per pack from 86 cents per pack to $1.08 per pack.

$46.0

$46.0

4/1/2016

Michigan

Extended the sunset on the cap on the maximum tax applied to a cigar. This cap is now set to expire on Oct. 31, 2021. No change in taxpayer liability.

-$2.5**

-$2.5**

10/1/2016

Pennsylvania

Increased tax on cigarettes by $1,from $1.60 per pack to $2.60 per pack.

$431.1

$446.6

8/1/2016

 

Introduced a 55 cent per ounce tax on alternative tobacco products such as smokeless tobacco and roll-your-own cigarettes with a floor minimum weight of 1.2 ounces.

$51.3

$81.9

10/1/2016 (alternative tobacco); 12/1/2016 (roll-your-own cigarettes)

 

Enacted a tax on e-cigarettes of 40 percent of the wholesale price imposed on vapor producing devices and liquid cartridges.

$13.3

$21.3

10/1/2016

Nevada

Raised the cigarette tax by $1 per pack. The rate went from $0.80 to $1.80 per pack. No change in taxpayer liability.

$95.4**

N.A.

7/1/2015

West Virginia

Increased cigarette tax by 65 cents, from $0.55 per pack to $1.20 per pack.

$92.4

$90.4

7/1/2016

 

Increased tax on alternative tobacco products by 5 percent from 7 percent of the wholesale price to 12 percent of the wholesale price.

$4.7

$4.7

7/1/2016

 

Enacted a tax on e-cigarettes. The new tax is imposed on the sales of e-cigarette liquid at a rate of 7.5 cents per milliliter.

$1.4

$1.8

7/1/2016

 

 

 

 

Appendix F: Alcohol Related Taxes

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Louisiana

Increased the excise tax rates on beer and other alcoholic beverages. Inventories on hand are not subject to the rate increase.

$19.2

$19.3

4/1/2016

New York

Adopted an Alcohol Beverage Production credit to extend to wine, cider and liquor. Also includes a sales tax exemption for alcoholic beverages used for tastings.

-$1.0

-$3.0

1/1/2016

Tennessee

Extended the temporary 50 cents per barrel of beer tax and the temporary 0.4 percent tax on gross receipts until July 1, 2022, or until July of any year following the enactment of any state or federal law that imposes mandatory deposits by consumers on beverage containers sold in Tennessee, whichever occurs first. No change in taxpayer liability

$4.9**

$4.9**

6/1/2016

 

 

 

 

 

Appendix F: Motor Fuel Excise Taxes

Jurisdiction

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Iowa

Extended the Environmental Protection Charge for motor fuel taxes. The 1 cent per gallon tax was extended six months and expired on Dec. 31, 2016. No change in taxpayer liability.

$7.0**

$0.0**

7/1/2016

Michigan

Raised the gas tax rate from 19 cents per gallon to 26 cents per gallon as part of a transportation funding package enacted in November 2015. This legislation also modified alternative fuel taxes.

$135.7

$212.8

1/1/2017

 

Raised the tax rate for diesel fuels from 15 cents per gallon to 26 cents per gallon as part of a transportation funding package enacted in November 2015.

$69.0

$92.9

1/1/2017

New Jersey

Increased petroleum products gross receipts tax for highway fuels (excluding diesel) by 12.85 percent or[KQ1]  22.6 cents per gallon. Effective Nov. 1, 2016. The gross receipts tax for diesel fuel will also increase to 70 percent of highway fuels tax rate effective Jan. 1, 2017, increasing to 100 percent of the rate on July 1, 2017. This rate will be adjusted annually to cap revenue. This revenue estimate includes revenue from both highway fuel and diesel taxation.

$694.1

$1,159.6

11/1/2016

 

Increased the petroleum products gross receipts tax on non-highway fuel oil and non-fuel products. The rate was increased from 2.75 percent to 7 percent, or 12.4 cents per gallon. The cents on the gallon calculation is adjusted quarterly based on price for fuel oil only.

$20.7

$31.1

1/1/2017

 

Increased the petroleum products gross receipts tax on diesel fuel. The increased rate will be phased in between Jan. 1, 2017 and July 1, 2017. The new rate will be 8 cents per gallon; the old rate was 4 cents per gallon.

$0.0

$39.6

7/1/2017

New York

Extended the alternative fuels tax exemptions (sales tax, petroleum business tax, and motor fuel tax). These exemptions are set to expire on Aug. 31, 2021. No change in taxpayer liability.

-$0.5**

-$1.0**

9/1/2016

Vermont

Increased fuel gross receipts tax from 0.5 percent per gallon to 0.75 percent, or 2 cents per gallon. Electricity is excluded from this increase. This is a temporary tax increase that is set to expire on June 30, 2021.

$3.8

N.A.

7/1/2016

West Virginia

Eliminated the Moor Fuel Tax for the railroad industry. The full effect of this credit will not be experienced until FY 2019 due to the timing of returns. Annual revenue impact for this credit is estimated to be a decrease of $4.3 million in the out years.

$0.0

-$1.0

N.A.

 

 

Appendix F: Miscellaneous Taxes

Jurisdiction

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Alaska

Modified various oil and gas tax credits.

$0.0

$15.0

Various

California

Reduced income-related taxes on certain health plans. This change affects certain premium income of health plan related insurers. The tax rate has been reduced from 2.35 percent to 0 percent. This is part of the MCO tax package and is set to expire on June 30, 2019.

-$210.0

-$350.0

7/1/2016

 

Enacted Proposition 64 legalizing recreational marijuana and hemp under state law. Designated state agencies to license and regulate marijuana industry. Imposed state excise tax on retail sales of marijuana equal to 15 percent of sales price, and state cultivation taxes on marijuana of $9.25 per ounce of flowers and $2.75 per ounce of leaves. Exempts medical marijuana from some taxation. This measure also allows for local regulation and taxation of marijuana. The legalization is estimated to raise $560 million in new revenue in FY 2019 and out years.

$0.0

$0.0

11/8/2016

Louisiana

Reinstated a 3 percent excise tax on short-term automobile rentals, with a 2.5 percent tax for state government and a 0.5 percent tax for local entities.

$5.0

$5.0

4/1/2016

 

Made a 5 percent reduction in the investment tax credit against premium tax that is available to insurers based on the share of admitted assets they hold in various Louisiana investments. This is effective for premium years 2016 and 2017. Also, imposed a 6 percent tax on premiums of health maintenance organizations participating in the State Bayou Health Program, which provides health care services to low-income populations.

$8.3

$8.6

Effective for premium years 2016 and 2017 

Massachusetts

Legalized possession and use of marijuana by a person 21 years of age or older. Retail marijuana is subject to the state sales tax with an additional 3.75 percent excise tax. Local municipalities are given the option of adding an additional 2 percent tax.

Retail stores set to open July 2018. Out-year fiscal impact unknown.

N.A.

1/1/2016

Nevada

Imposed a new 3 percent excise tax on the fare charged by a transportation network company (Uber and Lyft), a common motor carrier of passengers or a taxicab. No change in taxpayer liability.

$22.9**

N.A.

8/28/2015

Nevada, continued

Enacted a ballot measure legalizing the possession and use of marijuana by a person 21 years of age or older. An excise tax of 15 percent is imposed on wholesale sales of marijuana. The existing state sales tax would apply to retail sales of marijuana. Net revenue generated from this tax will be used for the support of K-12 education.

Indeterminate

Indeterminate

 11/8/2016

New Jersey

Modified estate tax to increase the exclusion from $675,000 to $2 million as of Jan. 1, 2017. The exclusion will increase to 100 percent of the estate beginning Jan. 1, 2018.

-$16.0

-$116.4

1/1/2017

North Carolina

Expanded mill machinery tax (1 percent per $80.00) to metal fabricators and secondary metal recyclers.

$1.6

-$1.8

7/1/2016

Oklahoma

Ended a gross production tax incentive for economically at-risk oil and gas leases. The measure limits the exemption to production from calendar year 2014 and provides that no claims for refunds will be paid after Dec. 31, 2016.

$51.8

N.A.

7/1/2016

Oregon

Increased the rate of the statewide transient lodging tax from 1 percent to 1.8 percent.

$13.6

$14.4

7/1/2016

Pennsylvania

Increased the Bank Shares Tax rate from 0.89 percent to 0.95 percent for the calendar year beginning Jan. 1, 2017 and each year thereafter.

$23.5

$24.8

1/1/2017

 

Introduced the Bank Shares Tax Edge Act Exclusions. Banks can exclude 20 percent of the book value of total equity capital of foreign subsidiaries from taxable income for the year beginning Jan. 1, 2018. There is a five-year phase-in allowing an additional 20 percent exclusion each year.

$0.0

-$2.9

1/1/2018

 

Adopted numerous changes to various tax credit programs.

-$20.9

-$49.3

Varies

 

In addition to the current table games tax of 12 percent, the state adopted a separate 2 percent tax on gross table game revenue. This additional rate will sunset in three years on June 30, 2019.

$16.8

$17.7

8/1/2016

 

Established a tax refund program for sales tax paid on computer data center equipment purchases for qualified centers. The program is capped at $5 million

$0.0

-$5.0

7/1/2017

 

Introduced a tax amnesty program. During a 60-day period within 2016-2017, delinquent taxpayers will be able to have penalties and 50 percent of interest waived on delinquencies that existed prior to Dec. 31, 2015.

$100.0

-$25.0

7/13/2016

Utah

Adjusted severance tax calculations to exclude royalty revenue in calculation of taxable value and taxable volume.

-$1.2

-$0.5

Retroactive to 1/1/2015

West Virginia

Enacted a 12 percent safety tax on all retail sales of newly legalized fireworks.

$2.2

$2.2

N.A.

 

 

 

 

Appendix F: Fees

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Alaska

Increased hunting, fishing and trapping fees.

$2.7

$9.1

1/1/2017

 

Enabled fees for Geologic Materials Center.

$0.1

$0.2

7/1/2016

California

Increased hazardous waste permitting fees, in part to address permitting backlogs at the Department of Toxic Substances Control.

$3.6

N.A.

N.A.

 

Extended hospital quality assurance fee for one year to Jan. 1, 2018. No change in taxpayer liability.

N.A.**

$850.0**

1/1/2017

Colorado

Increased fees for driver’s licenses and related services.

$1.1

$1.9

N.A. 

 

Created a monthly surcharge on all mobile wireless and Voice-over-Internet Protocol (VoIP) subscribers of 5 cents per line per month (60 cents per year). The additional surcharge revenue will be used to cover annual appropriations to the Reading Services for the Blind Cash Fund in the Colorado Department of Education (CDE) and the Colorado Commission for the Deaf and Hard of Hearing Cash Fund in the Department of Human Services (DHS).

$2.2

$2.2

8/10/2016

 

Created a surcharge of $1-$2 (determined administratively) on all documents that a county clerk and recorder retains for recording or filing certain documents related to real estate deeds or tax liens. Fee revenue goes to an enterprise fund in the Secretary of State’s office and is exempt from the state’s constitutional revenue limit. The surcharge repeals on Dec. 31, 2021.

$0.9

$1.8

1/1/2017

Connecticut

Capped probate court fees at $40,000 total for settling estates valued at $8.877 million. This change impacts the Probate Court Administration Fund and partially reversed a policy in last year’s budget that eliminated the $12,500 cap on estates over $2 million.

-$4.5

 -$4.5

7/1/2016

Florida

Adopted an out-of-state college tuition fee waiver for active duty service members.

-$1.0

-$1.1

7/1/2016

 

Enacted a concealed weapon license fee reduction.

-$3.5

-$2.8

7/1/2016

 

Enacted fingerprint retention fees.

$1.3

$1.1

7/1/2016

Idaho

Adopted a surcharge for penalties directed to General Fund rather than specific purposes.

$2.9

$2.9

7/1/2016

Kansas

Enacted new fees of $3.25 annually for each vehicle to increase highway patrol and law enforcement training funding. Increased fee from $39 to $42.25.

$9.1

$0.0

7/1/2016

Kentucky

Created a felony record expungement petition filing fee. The fee is $500.

$1.0

$1.0

7/15/2016

Louisiana

Authorized the Department of Health to increase the per-bed per-day fee charged to nursing facilities.

$16.9

$16.9

N.A.

 

Authorized the Department of Health to establish a provider fee for emergency ground ambulance service providers.

$2.5

$2.5

N.A.

Maryland

Reduced birth and death certificate fees from $24 to $10.

-$3.6

-$3.1

 7/1/2016

Michigan

Changed the rate of record lookup fees for the Secretary of State from $8 to $11.

$14.1

$14.1

N.A.

 

Changed the rate of motor vehicle registration fees. Fees vary, but are now generally 20 percent higher than the old rate. This was part of a larger transportation funding package enacted in November 2015.

$158.4

$215.9

 1/1/2017

Nevada

Raised the business license fee to $500 per year for corporations and $200 per year for non-corporation type businesses. No change in taxpayer liability.

$64.3**

N.A.

7/1/2015

 

Increased commercial recording fees. No change in taxpayer liability.

$2.8**

Indeterminate Increase

7/1/2015

New York

Reduced the Highway Use Tax Registration and Decal fee. Reduced the rate from $19 to $1.50.

-$59.0

-$6.0

4/13/2016

 

Allowed state flagship schools to increase out-of-state tuition by 10 percent.

$22.0

$22.0

8/1/2016

Oklahoma

Reissued the official state license plate with a new license plate design.

$13.0

N.A.

8/26/2016

Pennsylvania

Introduced non-recurring liquor modernization revenue through licensee surcharges, auctioning of restaurant licenses and casino license fees.

$73.2

$0.0

8/8//2016

Rhode Island

Reduced the beach fees.

-$1.3

-$1.8

7/1/2016

Tennessee

Revised provisions governing overweight and over-dimensional loads that are permitted and non-divisible. Old and new rates are various, and revenue will go to the Highway Fund.

$3.7

$7.4

1/1/2017

 

Made various changes to the Tennessee Higher Education Authorization Act, including but not limited to, requiring adoption of new policies and fees for authorization of postsecondary education institutions.

-$1.1

-$1.1

10/1/2016

 

Reduced the fee for a lifetime handgun carry permit from $500 to $300 for initial applicants and $200 for existing handgun carry permit holders.

$2.6

$5.2

1/1/2017

Vermont

Enacted multiple changes to the vehicle registration fees.

$9.9

N.A.

7/1/2016

 

Adopted changes to public safety fees.

$1.5

N.A.

7/1/2016

Vermont, continued

Increased mutual fund registration fee from $600 to $1,500.

$20.7

N.A.

7/1/2016

 

Increased broker-dealer registration fee from $60 to $85.

$3.3

N.A.

7/1/2016

Wisconsin

Increased state park and forest admission and trail fees from $25 to $28.

$1.4

$1.4

1/1/2016

 

Increased state park and forest camping fees.

$2.8

$2.9

1/1/2015

 

 

Appendix F: Other Non-Tax Revenue

State

Description

FY 2017 Amount

(in millions)

FY 2018 Amount

(in millions)

Effective Date

Oklahoma, continued

Enacted a Tax Commission initiative to enhance enforcement of miscellaneous tax collections.

$10.5

N.A.

8/26/2016

Pennsylvania

Introduced a tax amnesty program. During a 60-day period within 2016-2017, delinquent taxpayers will be able to have penalties and 50 percent of interest waived on delinquencies that existed prior to Dec. 31, 2015.

$100.0

-$25.0

7/13/2016

Rhode Island

Enhanced fraud and waste IT system increasing income and sales tax collections.

$5.0

$5.0

7/1/2016

 

Enhanced compliance on retaliatory assessments for insurance tax.

$1.1

$1.1

7/1/2016

 

Added additional staff and enhanced collection for personal income, business, and sales tax.

$3.4

$3.4

7/1/2016

 

Conducted a corporate tax intercompany transfer pricing audit.

$6.7

$0.0

7/1/2016

Tennessee

Modified the franchise and excise tax regarding current requirements to make estimated quarterly payments. Reduced the penalty for underpayments.

-$11.8

-$5.6

1/1/2016

 

Authorized terminal buildings of a commercial air carrier airport to sell packaged alcoholic beverages at retail, under certain conditions.

$6.9

$6.5

5/20/2016

Vermont

Changed collection schedule for the fuel gross receipts tax from quarterly to monthly.

$1.0

N.A.

1/1/2017

 

Changed collection schedule for the telephone property tax from quarterly to monthly.

$1.0

N.A.

1/1/2017

 

Changed collection schedule for the bank franchise tax from quarterly to monthly.

$1.8

N.A.

1/1/2017

Virginia

Raised the annual sales threshold from $2.5 million to $10 million in FY 2017 and to $25 million in FY 2018. The revenue loss in each year is one time in nature, reflecting the shifting of tax revenues from June of a given fiscal year into July of the next year.

-$36.7

-$27.0

N.A.

 

Enhanced sales tax review by introducing additional compliance measures in the Department of Taxation focusing on invalid sales and use tax exemption certificates related to sales tax on tobacco products.

$0.4

$1.5

N.A.

 

Enhanced personal income tax refund review by introducing additional compliance measures in the Department of Taxation aimed at preventing personal income tax fraud.

$3.2

$5.2

N.A.