The Deductibility of State and Local Taxes: Impact Effects by State and Income Class
26 Pages Posted: 6 Jul 2004 Last revised: 25 Mar 2010
Date Written: October 1985
This paper provides careful estimates of the impact of removing the deductibility of state and local taxes by state andby income class. We show how deductibility affects marginal and average tax rates for both state and federal tax systems. One striking result is that combined federal income tax and state tax burdens would generally fall under the President's tax reform proposal, even for high income people in high tax states.
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