State Tax Collections - U.S. Census Bureau

Quick takeaway: State sales taxes remain steady and dropped only slightly during the downturn of 2009.

Has the optimal gas tax been identified?

Mass High Tech's Kyle Alspach

In 2007, a study in the Journal of Economic Literature found that the ideal average gas tax for the U.S. would be $2.10 a gallonhttp://www.blogger.com/img/blank.gif. At the time, the average tax was 40 cents a gallon — 18.4 cents for federal and 22 cents for state (it’s currently 23.5 cents in Massachusetts).

The $2.10 figure takes into account greenhouse gas emissions, local pollution and oil dependency, along with the costs of congestion and accidents.

To make the tax palatable, economists say the government could cut taxes in other areas — say, the income tax for consumers or corporate taxes for businesses.

The tax trade-off seems like a reasonable idea but revenue-hungry politicians would never take up the offer.

In the rush to move toward a Pigouvian tax model, supporters of higher taxes tend to forget that such excise taxes are regressive. More than they did in the past, low-income workers rely more heavily on jobs in the suburbs and most use cars to get there.

State tax collections surge

DOR: "Total tax collections of $16.860 billion are up $1.927 billion or 12.9 percent, $732 million over benchmark" for April.

The BHI record on estimating state tax revenues in Massachusetts

At the December 14 revenue hearing, the Institute was asked by the Joint Ways and Means Committee to provide an accounting of the comparative success of the Beacon Hill Institute (BHI) in predicting tax revenues. This memo is our response to that request.

BHI releases revenue estimates for FY 2011, FY 2012

At a Joint Ways and Means Committee hearing on Tuesday, December 14, the institute presented its annual revenue estimates. BHI estimates that Massachusetts state tax revenues will come in at $20.363 billion for Fiscal Year 2011, a growth of 9.8% over FY 2010. Revenues will be $21.265 billion for FY 2012, 4.4% above 2011.

Read more about Tuesday's revenue hearing here.

Explaining the Shadow Budget

Director of Research Paul Bachman describes the Shadow Budget and its application to the Commonwealth of Massachusetts in an interview with Jim Musser of the Mercatus Center.

The "Shadow Budget" is part of a proposal outlined in BHI's latest study, Massachusetts Fiscal Policy: The Legend v. the Facts.

The study also hypothesizes how the Commonwealth of Massachusetts would have performed it a Tax and Expenditure (TEL) were in place since 1999.