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TAX FOUNDATION: RETURN THE SHARP OBJECTS TO THE TODDLERS
July 25, 2005
The Tax Foundation has asked the Supreme Court to reverse the Sixth Circuit's Cuno decision. The decision declared a collection of Ohio corporate welfare tax incentives to be unconsitutional interference by the state in interestate commerce. The Tax Foundation thinks Cuno is overly broad and will provide too many limits on tax competition between the states.
From a policy standpoint, Cuno looks to be a gift from the gods to end the circular firing squad collection of state tax incentives, like the Grow Iowa Values Fund. As Cuno would have to fit within existing Supreme Court decisions that do allow for various kinds of state competition - in rates, for example, or the use of preferential apportionment regimes - the Tax Foundation concerns seem misplaced to me. Even the Tax Foundation agrees that the incentives are bad policy.
The Center for Budget and Policy Priorities has a critique of the Tax Foundation position here.
(I agree with the CBPP instead of the Tax Foundation? Oy.)
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