 One hundred years of U.S. state taxationSarah Robinson and Alisa Tazhitdinova Journal of Public Economics, 2025, vol. 241, issue C Abstract: We analyze the evolution of U.S. state tax rates since 1910 and state tax revenues from 1942 until 2022. Tax policy shifted rapidly at the beginning of the 20th century, but in many ways has remained remarkably stable over the past fifty years. Even as tax rates change frequently and vary widely across states, the degree of heterogeneity across states in rates and revenues is very similar over time. We document two key insights for empirical researchers using variation in tax policy for identification. First, tax changes do not appear to be driven by economic conditions, as neither the timing of tax changes nor tax rates themselves exhibit a predictable pattern around state recessions. Second, throughout the time period we study, many tax changes occur simultaneously, particularly for personal, corporate, and sales taxes. Because the coinciding changes are typically moving in the same direction, researchers should use caution when attributing effects to a specific type of tax, and we show that estimates can be sensitive to controlling for additional tax rates. Keywords: State taxes; Federal taxes; Fiscal federalism; Income tax; Corporate tax; Sales tax; Cigarette tax; Alcohol tax; Gasoline tax (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:241:y:2025:i:c:s0047272724002093 DOI: 10.1016/j.jpubeco.2024.105273 Access Statistics for this article Journal of Public Economics is currently edited by R. Boadway and J. Poterba More articles in Journal of Public Economics from Elsevier |
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