Casual investors understand that states approach taxation of its citizens differently and can have different approaches to raising revenue.

However, in the last month, there has been a shift in the directionality of state tax policy.

Seven states (including NY and CA) released aggressive (and interrelated) proposals to increase taxes.

Some of these proposals center around forms of the controversial “wealth tax” – a tax that would raise revenue from unrealized gains.

JARED WALCZAK will explore the new proposals, the likelihood of passage and their broader impact. 

Jared Walczak is Vice President of State Projects at the Tax Foundation. He is the lead researcher on the annual State Business Tax Climate Index and Location Matters, and has authored or coauthored tax reform guides on Alaska, Iowa, Kansas, Louisiana, Nevada, New  York, Pennsylvania, South Carolina, West Virginia, and Wisconsin. Jared’s work is regularly cited in The New York TimesThe Wall Street JournalThe Washington PostLos Angeles Times, Politico, AP, and many other prominent national and state outlets.

He previously served as legislative director to a member of the Senate of Virginia and as policy director for a statewide campaign, and consulted on research and policy development for a number of candidates and elected officials.

He has been recently quoted extensively on this topic in the Wall Street Journal, the New York Post, and MarketWatch.

Trying to predict tax legislation can be folly.

However, states are known to be the laboratory for broader national tax legislation.

These state proposals can provide interesting data points on the mood of legislatures and the directionality of tax policy across the nation.

It’s important to know about them. Enjoy the conversation with Jared Walczak.

Jared’s Background 

The Tax Landscape

  • Context around
    • Income Taxes
    • Capital Gains Taxes
    • Estate Taxes
    • Wealth Taxes
  • State Taxes vs Federal Taxes
  • “Raising Revenue” vs “Wealth Redistribution”
  • What is new in 2023 that has 7 states looking to raise taxes?
  • Which states are we looking at here?
    • California
    • Connecticut
    • Hawaii
    • Illinois
    • Maryland
    • New York
    • Washington
  • What about the passage of Massachusetts’ Millionaire Tax?
  • What is the likelihood of passage?
  • What does this tell us about the “Diverging Directionality” of State Tax Policy?

Wealth taxes?

  • We’re already used to the concept of taxing unrealized gains with property taxes-
  • Not popular- Haven’t these been tried worldwide and often discarded?
  • Administratively difficult?  Invest in valuation firms!
  • Forced liquidations? Lower Business Valuations? Reduced Returns for Shareholders?
  • Fairness?  Do you get a carry forward if there is a loss?
  • Is the Wealth Tax Constitutional?  Is it a Taking?
  • Is this a Business Climate to be Encouraged?

Tax increase Directionality

  • What do the tea leaves look like?
  • What political points can be scored in such a divided environment?
  • Any big crystal ball predictions here?

How do we keep track of Jared and the Tax Foundation?



@JaredWalczak ON TWITTER

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