Tax Foundation

Tax Foundation
Motto Educating Taxpayers Since 1937
Formation 1937
Type Think tank
Headquarters 1325 G Street NW, Suite 950
Location
  • Washington, D.C., United States
President
 Scott A. Hodge
Website www.taxfoundation.org

The Tax Foundation is a Washington, D.C.-based think tank founded in 1937 that collects data and publishes research studies on US tax policies at both the federal and state levels. The Foundation's stated mission is to "educate taxpayers about sound tax policy and the size of the tax burden borne by Americans at all levels of government." The Tax Foundation is organized as 501(c)(3) tax-exempt non-profit educational and research organization. It describes itself as a nonpartisan tax research group.[1] However, commentators have described it as pro-business and conservative.[2][3][4]

The organization is organized into three primary areas of research, carried out by the Foundation's Center for Federal Fiscal Policy, the Center for State Fiscal Policy[5] and the Center for Legal Reform.[6] The group is known for its annual reports such as "Facts & Figures: How Does Your State Compare"[7] which was first produced in 1941[8] and Tax Freedom Day for the United States, which it has produced since the early 1970s.

Goals and principles

Tax Foundation states that their research is guided by what they call the principles of sound tax policy: simplicity, transparency, neutrality, stability, no retroactivity, broad bases and low rates.[9]

Tax Foundation research is generally critical of tax increases,[10][11][12][13] high business taxes,[14] excise taxes,[15] tax preferences for the housing industry,[16] and use of the tax credits (which the Foundation views as "picking winners and losers").[17][18] The Foundation have spoken favorably of efforts to balance the federal budget with tax reform and significant spending cuts, such as the Bowles-Simpson plan,[19] the Ryan Plan,[20] and the Wyden-Coats plan.[21]

Activities

Since 2013, the Tax Foundation has offered guidance to same-sex married couples filing income taxes at the state level, where local laws recognizing same-sex marriage can vary considerably.[22][23]

History

The Tax Foundation was organized on December 5, 1937 in New York City by Alfred P. Sloan, Jr., Chairman of the General Motors Corporation; Donaldson Brown, GM Financial Vice President; William S. Farish, President of Standard Oil Company of New Jersey (Exxon); and Lewis H. Brown, President of Johns-Manville Corporation, who later became the first Chairman of the Board of The Tax Foundation.[24] The stated goal of the organization was "to monitor the tax and spending policies of government agencies".[25] Its offices were located at 50 Rockefeller Plaza and later 30 Rockefeller Plaza.

The Tax Foundation's first project was a successful effort to stop a tax increase in Westchester County, New York, where they provided research and analysis (including an "Expenditure Survey" of state spending) to local activists.[25] By 1943, the Tax Foundation had helped set up taxpayers associations and expenditure councils in 35 states.[25]

During World War II, Tax Foundation research emphasized restraining government spending domestically to finance wartime expenditures. In 1948, the Tax Foundation opened an office in Washington, D.C., and in 1978 relocated there completely.[25] Its research and analysis has historically emphasized publicizing federal and state financial information, arguing against the use of tax systems for "social engineering," and urging "broad bases and low rates" tax reform.[1][25]

Beginning in 1990, the Tax Foundation "operate[d] as a separate unit" of Citizens for a Sound Economy.[26] By July 1991, the Tax Foundation was again operating as an independent 501(c)(3) organization.[27]

Beginning in 2009, The Tax Foundation's offices were located in the National Press Building in Washington, D.C.[28] In 2015, the Tax Foundation left the National Press Building.[29]

Board of directors

NameTermOther Affiliations
Ongoing Directors:[30]
David P. Lewis, Chairman2009–currentEli Lilly and Company, Vice President Global Taxes; Tax Council Policy Institute, Treasurer[31]
James Lintottpre-1999–currentSterling Foundation Management
Bill Archer2003–currentformer member of the United States House of Representatives from Texas
Philip Englishcurrentformer member of the United States House of Representatives from Pennsylvania
Douglas Holtz-Eakin2009–currentPresident of the American Action Forum, former Director of the Congressional Budget Office, chief economic adviser to Presidential candidate John McCain in 2008
Stephen Kranzcurrentpartner at McDermott Will & Emery
Sarah McGill2009–currentPepsico, VP Tax Planning
Pamela F. Olson2009–currentDeputy Tax Leader at PwC;[32] formerly at Skadden, Arps; senior economic adviser to the Bush-Cheney campaign and formerly Assistant Secretary of Treasury for Tax Policy[33] under Pres. Bush
Tom RoessercurrentMicrosoft, Senior Director of Tax Affairs
Former Directors (post-1990):
Wayne E. Gablepre-1999–2008[34] Koch Industries Dir. of Federal Affairs, Citizens for a Sound Economy, Americans for Prosperity
James C. Miller III1989–2005Citizens for a Sound Economy; Director of OMB under President Reagan
Joseph O. Luby, Jr.2000–2006Exxon Mobil, VP Tax
James Q. Riordanpre-1989–1999Mobil, VP Tax
R. Glenn Hubbard2003–2008Chairman of President Bush's Council of Economic Advisers
Michael P. Boyle2002–2006Microsoft, VP Finance

Funding

The Tax Foundation accepts grants from foundations, corporations, and individuals. It does not solicit or accept funds from government sources.[35] The Tax Foundation has earned a 3 out of 4 star financial rating and 4 out of 4 star accountability and transparency rating from Charity Navigator.[36]

Year Revenues Expenses
2013[37] $2,953,060 $2,469,668
2012[38] $2,192,620 $1,900,821
2011[39] $1,885,201 $1,768,828
2010[39] $1,854,135 $1,925,936

The Tax Foundation has received funding from ExxonMobil[40] and from conservative political groups such as the Koch Family Foundations,[41] the Earhart Foundation,[42] and numerous others.[43]

Criticisms

The Tax Foundation's annual study that calculate Tax Freedom Days in the United States has been criticized by left-leaning think tanks, such as the Center on Budget and Policy Priorities (CBPP)[44] and Citizens for Tax Justice (CTJ),[45] citing repeated "methodological errors" and "reliance on early projections without hard data." CBPP has also criticized other reports by the Tax Foundation,[46][47][48] and in turn the Tax Foundation has responded or criticized CBPP reports.[49][50][51][52][53] The two groups have some areas of agreement, such as opposition to most tax expenditures[54] and sales tax holidays.[55][56] The Tax Foundation and CBPP have also worked together on analysis of the marriage penalty in the US federal income tax.[57]

US economist Paul Krugman has characterised the Tax Foundation as "not a reliable source" while criticizing a report by the Tax Foundation comparing corporate tax rates in the United States to those in other countries.[58] Krugman has also accused the Tax Foundation of "deliberate fraud" in connection with a report it issued concerning the American Jobs Act.[59]

See also

Notes

  1. 1 2 "About the Tax Foundation". Retrieved 2011-04-28.
  2. ↑ "Factcheck.org: Misleading Ads on Obama's Small-Business Tax Plan – Newsweek". Newsweek. 2011. Retrieved April 15, 2011.(Subscription required.)
  3. ↑ "Power Trips: Congress hits the road". MedillNewsDC.com. 2000-01-01. Archived from the original on 2013-06-20. Retrieved 2013-02-22.
  4. ↑ Kevin Drum (2007-10-10). "The Washington Monthly". The Washington Monthly. Retrieved 2013-02-22.
  5. ↑ "Tax Research Areas > State Tax and Spending Policy". The Tax Foundation. Retrieved 2012-04-05.
  6. ↑ "Tax Research Areas > Tax Law". The Tax Foundation. Retrieved 2012-04-05.
  7. ↑ "Facts & Figures Handbook: How Does Your State Compare?". The Tax Foundation. 2012-02-15. Retrieved 2012-04-05.
  8. ↑ "The Tax Foundation". The Tax Foundation. Retrieved 2012-04-05.
  9. ↑ "Principles of Sound Tax Policy". Taxfoundation.org. August 20, 2007. Retrieved August 31, 2012.
  10. ↑ "Portland Business Journal, Tax Foundation Criticizes State Tax Hikes". Taxfoundation.org. 2009-07-09. Retrieved 2012-04-05.
  11. ↑ "Tax Foundation, Maryland Tax Increases Can’t Keep Up With Spending Increases". Taxfoundation.org. 2008-12-29. Retrieved 2012-04-05.
  12. ↑ "Tax Foundation, The Economic Cost of High Tax Rates". Taxfoundation.org. 2009-07-29. Retrieved 2012-04-05.
  13. ↑ "Tax Foundation, Oregon’s Wave of Tax Increases and New Spending". Taxfoundation.org. 2009-07-09. Retrieved 2012-04-05.
  14. ↑ "Tax Foundation CompeteUSA Project". Taxfoundation.org. Retrieved 2012-04-05.
  15. ↑ "Excise Taxes". Tax Foundation. Retrieved 2012-04-05.
  16. ↑ "Tax Foundation, Giuliani Wrong on Mortgage Interest Deduction". Taxfoundation.org. 2007-12-03. Retrieved 2012-04-05.
  17. ↑ "Tax Foundation, Louisiana Tax Credits: Politicians Picking Winners and Losers". Taxfoundation.org. 2009-07-11. Retrieved 2012-04-05.
  18. ↑ "Tax Foundation, Remarks to the Shaftesbury Society Luncheon". Taxfoundation.org. 2009-05-05. Retrieved 2012-04-05.
  19. ↑ "Draft from President's Deficit Commission Stirs the Fiscal Pot in Washington". Retrieved 2011-05-14.
  20. ↑ "Ryan Plan Smartly Marries Tax Reform with Spending Reform". Retrieved 2011-04-28.
  21. ↑ "Wyden-Coats Tax Reform Plan Adds to Debate But Needs Fixing". Retrieved 2011-05-14.
  22. ↑ Joseph Henchman (2013-09-13). "Wisconsin Offers Constructive Tax Filing Guidance for Same-Sex Couples". Tax Foundation. Retrieved 2015-04-09.
  23. ↑ Joseph Henchman (2015-03-20). "10 Remaining States Provide Tax Filing Guidance to Same-Sex Married Taxpayers". Tax Foundation. Retrieved 2015-04-09.
  24. ↑ "Tax Foundation, Celebrating Our 65th Year". Taxfoundation.org. 2002-09-01. Retrieved 2012-04-05.
  25. 1 2 3 4 5 "Tax Foundation 1937–1987: The First Fifty Years" (PDF). Tax Foundation. 1987.
  26. ↑ "Tax Features" (PDF). Tax Foundation. January 1990. Retrieved September 8, 2014.
  27. ↑ "Tax Features" (PDF). Tax Foundation. July 1991. Retrieved September 8, 2014.
  28. ↑ "Tax Foundation, Contact Us". Taxfoundation.org. Retrieved 2012-04-05.
  29. ↑ "Tax Foundation, Office Warming Reception". Taxfoundation.org. Retrieved 2015-04-09.
  30. ↑ "Board of Directors – Tax Foundation". 2014. Retrieved August 31, 2014.
  31. ↑ "TCPI – Tax Council Policy Institute". tcpi.org. 2011. Retrieved April 14, 2011.
  32. ↑ "Tax Policy Leadership". Retrieved September 2, 2014.
  33. ↑ "Pamela F. Olson, Skadden bio Retrieved 2011-03-21". Skadden.com. Retrieved 2012-04-05.
  34. ↑ "Tax Foundation Form 990s". Economic Research Institute. Retrieved 26 April 2012.
  35. ↑ "Tax Foundation, Funding". Retrieved 2015-04-09.
  36. ↑ "Charity Navigator Rating – Tax Foundation". Retrieved 2015-04-09.
  37. ↑ "2013 Form 990, Tax Foundation" (PDF). Foundation Center. Retrieved 2015-04-09.
  38. ↑ "2012 Form 990, Tax Foundation" (PDF). Foundation Center. Retrieved 2015-04-09.
  39. 1 2 "2011 Form 990, Tax Foundation" (PDF). Foundation Center. Retrieved 2015-04-09.
  40. ↑ cite web|url=http://conservativetransparency.org/org/tax-foundation/?og_tot=203&order_by=&adv=exxon&min=&max=&yr=&yr1=&yr2=&submit=#grants
  41. ↑ {cite web|url=http://conservativetransparency.org/org/tax-foundation/?og_tot=203&order_by=&adv=koch&min=&max=&yr=&yr1=&yr2=&submit=#grants}
  42. ↑ "Media Transparency: Grants from Earhart Foundation to Tax Foundation". Old.mediatransparency.org. Retrieved 2012-04-05.
  43. ↑ {cite web|url=http://conservativetransparency.org/top/adv/?recipient%5B%5D=885&yr=&yr1=&yr2=&submit=}
  44. ↑ Lav, Iris J.; Shapiro, Isaac; Greenstein, Robert (May 10, 1999). "Tax Foundation Figures Produce Misleading and Inaccurate Impressions of Middle Class Tax Burdens". Retrieved April 15, 2011.
  45. ↑ "Tax Foundation State Rankings Continue to Deceive". ctj.org. 2011. Retrieved April 15, 2011.
  46. ↑ Michael Mazerov (July 20, 2005). "The Tax Foundation’s Analyses Of The CUNO Decision: Inaccurate And Inconsistent". Center on Budget and Policy Priorities. Retrieved 26 April 2012.
  47. ↑ Aron, Aviva (April 23, 2008). "Tax Foundation Figures Do Not Represent Typical Households' Tax Burdens: Figures May Mislead Policymakers, Journalists, and the Public – Center on Budget and Policy Priorities". Cbpp.org. Retrieved October 17, 2011.
  48. ↑ "Don't Let the Tax Foundation Figures Persuade You Otherwise: Taxes on Households in the Middle of the Income Spectrum are Neither Exceptionally High nor Rising". Center on Budget and Policy Priorities. April 15, 1998. Retrieved 26 April 2012.
  49. ↑ "CBPP Report Confuses Two Issues; Ignores Budget Reform Opportunity". The Tax Foundation. January 8, 2009. Retrieved October 17, 2011.
  50. ↑ "CBPP Critique of State and Local Burden Methodology Is Baseless and Hypocritical". The Tax Foundation. August 8, 2008. Retrieved October 17, 2011.
  51. ↑ "CBPP Puts Out Misleading Information on Poor and Cigarette Taxes". The Tax Foundation. October 18, 2007. Retrieved October 17, 2011.
  52. ↑ "CBPP Report Longs for a Poorer Country". The Tax Foundation. August 27, 2008. Retrieved October 17, 2011.
  53. ↑ "S-Corps and LLCs Pay Lots of State Taxes Already, Via Their Shareholders". The Tax Foundation. April 9, 2009. Retrieved October 17, 2011.
  54. ↑ "CBPP Issues Report on Tax Expenditures". The Tax Foundation. April 13, 2009. Retrieved October 17, 2011.
  55. ↑ http://www.cbpp.org/cms/index.cfm?fa=view&id=1369
  56. ↑ Cox, Amanda (August 3, 2006). "Sales Tax Holidays: Politically Expedient but Poor Tax Policy". The Tax Foundation. Retrieved October 17, 2011.
  57. ↑ "Tax Day: Are You Receiving a Marriage Penalty or Bonus?". The New York Times. April 15, 2015. Retrieved September 5, 2015.
  58. ↑ Krugman, Paul (2008-08-24). "The Tax Foundation is not a reliable source". The Conscience of a Liberal blog, nytimes.com. Retrieved March 18, 2011.
  59. ↑ "Stocks, Flows, and Fuzzy Math". Krugman.blogs.nytimes.com. October 11, 2011. Retrieved October 17, 2011.

External links

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