In an article for Tax Notes State, Bass, Berry & Sims attorneys Mike Sontag, Steve Jasper, and Michael Cottone outlined states’ likely responses to lost revenue caused by the COVID-19 pandemic. The authors advise taxpayers to be cautious of – and prepare for – states trying to close budgetary gaps by:
- Aggressively pursuing corporate income tax liability for out-of-state businesses.
- Broadening the base for sales and use tax.
- Limiting credits and incentives.
- Increasing rates on “vice” taxes and taxes levied on small groups of individuals or businesses.
The full article, “How Will States Respond to Pandemic-Related Revenue Shortfalls?” was published by Tax Notes State on December 21 and is available online.