"The Way We Tax," Governing magazine

"The Way We Tax," Governing magazine

According to an article in the February issue of Governing magazine, most state tax systems are not up to the task of funding governments in this day and age, especially at a time when many states are facing their worst budget crises in more than fifty years. With support from the Pew Center on the States, the magazine conducted a yearlong study to assess the tax systems in all fifty states in the areas of revenue adequacy, fairness, and management. The results, as described in the "The Way We Tax" (11 pages, HTML), reveal that eleven states, including three of the largest — California, Florida, and Texas — have tax codes that are so out-of-date and inefficient that they need to be completely redesigned. And the other states — with the exception of Delaware, New Mexico, North Dakota, and Wyoming — have systems that require a substantive overhaul. Unfortunately, the study goes on to say, many states are cutting funding for their tax departments at a time when the potential additional revenue that could be generated by those departments is desperately needed.