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BPAA State Policy Updates - October 5

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  • 2019 State Business Tax Climate Index: The Tax Foundation’s State Business Tax Climate Index enables business leaders, government policymakers, and taxpayers to gauge how their states’ tax systems compare. While there are many ways to show how much is collected in taxes by state governments, the Index is designed to show how well states structure their tax systems and provides a road map for improvement. Read the findings here at the Tax Foundation.
  • Arkansas Continues to Debate Tax Reform: Today, the Arkansas Tax Reform and Relief Legislative Task Force continued to debate how to implement much-needed tax reform in 2019. The newly released 2019 State Business Tax Climate Index illustrates just how important reform is to Arkansas. Arkansas fell again this year, largely as other states jump ahead of the Natural State. Arkansas is now ranked 46th, among the bottom five states. The task force asked me to present on two separate topics today. First, they wanted to understand the impact of proposed individual income tax changes on various Arkansans. With the assistance of Professor Jeremy Horpedahl at the Arkansas Center for Research in Economics, we created eight sample taxpayers and estimated their associated tax cuts. An individual with adjusted gross income of $50,000 would see a net tax cut of $166 under one plan and $80 under the second. Read more here.
  • Arizona Income Tax Increase Not on November Ballot: Arizona’s November election ballot will not include a proposal to increase income taxes for K-12 education funding, after the state Supreme Court ruled on August 29 that the “Invest in Ed” measure was not written clearly. It would have raised an additional $690 million in revenue each year. Proposition 207, which was placed on the ballot after supporters gathered 270,000 signatures, would have raised the top state income tax from 4.54 percent to 9 percent, making Arizona’s income tax one of the highest in the nation: Read here.
  • South Carolina legislators passed a federal conformity bill that Gov. Henry McMaster is expected to sign. The bill decouples from several business tax changes, creates a new dependent exemption worth $4,110 per child (doubled for children under six), and adjusts income tax brackets for inflation.


  • D.C. Council Blocks Tipped Minimum Wage Increase: The Washington, D.C., city council on Oct. 2 blocked a minimum wage increase for tipped workers. Voters in June voted to eliminate a provision in the city’s minimum wage law that lets businesses count customer tips as wages. It would have the effect of increasing the amount employers must pay tipped workers. The measure was projected to start phasing in a higher tipped wage on Oct. 9. The council gave preliminary approval earlier in the day to a separate bill that would fully repeal the initiative. That bill is still tied up in the legislative process.


  • Indiana task force to make alcohol recommendations: An Indiana task force that's conducting an in-depth review of the state's alcohol laws is expected to recommend a boost in funding for the state agency that enforces alcohol consumption laws, rather than suggesting that Indiana expand cold beer sales. The potential recommendation by the Indiana Alcohol Code Revision Commission would aim to create more tools for local governments to grant alcohol permits to bars and restaurants, and to generate more oversight for the resale market for alcohol permits, the Indianapolis Star reported. Republican Sen. Ron Alting of Lafayette, a member of the commission, which is made of lawmakers and industry leaders, said the Indiana Alcohol and Tobacco Commission needs more funding to hire more officers, employees and to update technology. But Alting, who acts as a gatekeeper to state alcohol laws as chairman of the Senate Public Policy Committee, also said that creating a more robust Alcohol Tobacco Commission that could more quickly and efficiently process permits and licenses while enforcing consumption laws could "absolutely" lead to an expansion of cold beer sales. The state agency currently has a $13 million budget but fewer than one excise officer per county. There are 74 officers to enforce laws in 92 counties. Read more at WANE.
  • What's on tap for Maryland's liquor laws?: A new task force is reviewing alcohol regulations in Maryland, and the members are looking at everything from production and sales to the impact of alcohol on public health. But mainly, they'll be looking at whether it's the Office of the Comptroller that should continue regulating the industry and enforcing liquor laws. The Task Force to Study State Alcohol Regulation, Enforcement, Safety and Public Health results from legislation passed by the Maryland General Assembly this year. It includes legislators, designees of the state Health Department and Maryland State Police and representatives of the Licensed Beverage Association, Mothers Against Drunk Driving, the medical community, manufacturers, wineries and craft brewers, local law enforcement and members of the public. One of those members of the public, Hagerstown attorney and former state legislator Bruce Poole, is chairing the panel. The task force is just beginning its work; members have met only once so far. The goal is to produce a report with recommendations by December — in time for lawmakers to review when the General Assembly reconvenes in January. Read more at Herald-Mail Media.


  • Parx And Hollywood Casinos Get Green Light For PA Sports Betting: A public meeting of the Pennsylvania Gaming Control Board (PGCB) approved two interactive gaming certificates and three sports betting applications. Penn National was the first operator to apply for a license for PA sports betting. It has now been approved to conduct sports betting at its Hollywood Casino. First bets could be placed as early as November. Like almost all the preliminary PGCB’s authorizations, Penn National will have to comply with a number of conditions before it can start operations. The PGCB also approved Parx Casino, which asked for authorization to start sports betting at its main casino and the South Philadelphia Turf Club. Read more at Legal Sports Betting.
  • Sports Betting Is Coming to D.C. in February: The District of Columbia should be allowing legal sports bets by the 2019 Major League Baseball season, the council member behind recently introduced legislation said. “I’m hoping, given all the upcoming holidays, that this will become law in the District in February, and then we can have everything in place in time” for the Washington Nationals’ baseball season, council member Jack Evans (D) told Bloomberg Tax. The 2019 Major League Baseball Season kicks off March 28, 2019, and states that have already legalized sports betting have seen a sharp spike in revenue figures because of the 2018-19 National Football League season. The Sports Wagering Lottery Amendment Act of 2018, introduced by Evans Sept. 18, would legalize in-person and online sports bets and levy a 10 percent tax on gross revenue from wagers. It needs the approval of seven council members to advance. It was introduced with the support of six council members, and Evans said he has an additional member who will vote for it. Mayor Muriel Bowser (D) also backs the bill.
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