The ITEP Guide to Fair State and Local Taxes: Sales and Excise Taxes
Type
Policy Brief or Report
Year
2011
Level
City or Town, County
State(s)
All States
Policy Areas
Democracy & Governance, Finance & Procurement
Sales and excise taxes, or consumption taxes, are an important revenue source, comprising close to half of all state tax revenues in 2010. But these taxes are inevitably regressive, falling far more heavily on low- and middle income taxpayers than on the wealthy. Consumption taxes also face structural problems that threaten their future viability. This chapter looks at how these taxes work, and outlines options for making consumption taxes somewhat less unfair and more sustainable.