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Introduction and Mission Statement

The Economics of STAMP

How STAMP works

The CGE Team

Deliverables

States that have applied STAMP

What the press is saying about STAMP

 

STAMP: SHOWING HOW STATE TAXES MATTER

Introduction
Endorsements
Simulations

 

Summary of the Simulation Results of BHI's State Tax Analysis Modeling Program (STAMP)

The following tables present findings of tax model simulations estimated using seven of the 15 STAMPs that are currently in use. For each state we used STAMP to simulate the effects of a one percent increase in both the income and sales tax rates. The tables here show the effects of those simulation on tax revenues, employment and the capital stock in each state. Since there is currently no income tax in Texas, STAMP cannot accurately address the implications of such a policy change. Therefore, you will see n/a for the income tax change simulation for that state. At the bottom of each table you will see an average, weighted by population, of the results of the simulation in all the states presented.

Reduction in Sales Tax by One Percentage Point:

Effects on State Tax Revenues (%)

2001 2002 2003 2004

Arizona

-13.5 -13.2 -12.4 -11.7
California -2.5 -2.0 -1.8 -1.6
Michigan -9.5 -8.8 -8.2 -7.7
New York -3.1 -3.2 -3.3 -3.4
Pennsylvania -4.2 -4.2 -4.2 -4.3
Texas -11.1 -11.1 -11.1 -11.1
Virginia -2.8 -2.5 -2.4 -2.4
Weighted Average -5.7 -5.4 -5.3 -5.1
 
Reduction in Income Tax by One Percentage Point:

Effects on Sales Tax Revenue(%)

2001 2002 2003 2004

Arizona

-7.3 -7.5 -7.7 -7.9
California -5.0 -4.7 -4.6 -4.5
Michigan -7.0 -7.5 -8.1 -8.7
New York -6.4 -6.5 -6.6 -6.8
Pennsylvania -12.7 -12.9 -13.2 -13.8
Texas n/a n/a n/a n/a
Virginia -5.0 -4.5 -4.2 -4.1
Weighted Average -6.7 -6.7 -6.8 -6.9
 
Reduction in Sales Tax by One Percentage Point:

Effects on Employment (%)

2001 2002 2003 2004

Arizona

0.0 0.0 0.0 0.0
California 2.0 2.7 3.1 3.2
Michigan 0.0 0.0 0.0 0.0
New York 0.8 0.8 0.8 0.8
Pennsylvania 3.4 3.4 3.4 3.4
Texas 1.4 1.4 1.4 1.4
Virginia 1.3 1.8 2.1 2.1
Weighted Average 1.5 1.8 1.9 2.0
 
Reduction in Income Tax by One Percentage Point:

Effects on Employment (%)

2001 2002 2003 2004

Arizona

0.9 0.9 0.9 0.9
California 0.9 1.2 1.4 1.4
Michigan 2.1 2.1 2.1 2.1
New York 0.9 0.9 0.9 0.9
Pennsylvania 1.2 1.2 1.2 1.2
Texas n/a n/a n/a n/a
Virginia 2.8 3.9 4.4 4.6
Weighted Average 1.2 1.4 1.5 1.6
 
Reduction in Sales Tax by One Percentage Point:

Effects on Capital Stock (%)

2001 2002 2003 2004

Arizona

0.0 0.0 0.0 0.0
California 0.0 0.0 0.0 0.0
Michigan 0.0 0.0 0.0 0.0
New York 0.0 0.0 0.0 0.0
Pennsylvania 0.0 0.0 0.0 0.0
Texas 1.4 1.4 1.4 1.4
Virginia 0.0 0.0 0.0 0.0
Weighted Average 0.0 0.0 0.0 0.0
 
Reduction in Income Tax by One Percentage Point:

Effects on Capital Stock (%)

2001 2002 2003 2004

Arizona

0.0 0.0 0.0 0.0
California 1.6 3.0 4.2 5.3
Michigan 0.0 0.0 0.0 0.0
New York 0.0 0.0 0.0 0.0
Pennsylvania 0.0 0.0 0.0 0.0
Texas 0.0 0.0 0.0 0.0
Virginia 2.6 4.3 5.4 6.1
Weighted Average 0.9 1.6 2.2 2.7

 


 

Persons interested in acquiring a STAMP for their state should contact:

Dr. David G. Tuerck, Executive Director
Beacon Hill Institute,
165 Main Street, Suite 306
Medway, MA 02053
Phone: 617-821-7698
Email: dtuerck@beaconhill.org

 



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