We are looking ahead to November ballot initiatives that could bring dramatic tax policy changes. States across the country will consider a host of ballot measures that could reshape the fairness and adequacy of their states’ tax systems, ranging from progressive taxes on high-income individuals to steeply regressive tax cuts and measures that would close the door to future progressive reforms that ask more of the wealthy. In fact, just this past week, Colorado’s Initiative 195 qualified for the ballot. Read more here for some of what we’re following on state ballots.

Meanwhile, states are receiving budget forecasts that could further shape upcoming policy debates, with revenues recently falling short on a business-to-business IT and data services tax in Maryland and on retail cannabis sales in Delaware.

• COLORADO voters will decide whether to graduate to a graduated income tax and kick their flat tax to the curb this November, following proposed Initiative 195 qualification for the ballot. The proposal would replace the state’s flat income tax with a progressive structure that would include a top rate of 8.4 percent on annual income over $1 million. If passed, 97 percent of Coloradans (those earning less than $500,000 a year) would see a slight income tax reduction. The initiative would raise $2 billion in new revenue for the 2027-2028 fiscal year. – NEVA BUTKUS
• UTAH has now raised over $1.6 million in delinquent property taxes from residents who fraudulently registered their vehicle in Montana. Many drivers across the nation have used Montana’s permissive laws to register their vehicles under an LLC and avoid property taxes where they actually live. Other states have also undertaken enforcement campaigns, but Utah has made especially thorough use of insurance registrations. – ELI BYERLY-DUKE

• DELAWARE’S tax revenue from its first retail marijuana stores is falling short of projections, collecting about $8.8 million compared to the $42 million the state estimated it would collect thus far. However, state officials say there is still potential for more revenue as the number of marijuana retailers continue to grow.
• FLORIDA Gov. Ron DeSantis believes concerns about the impacts of Amendment 3 (a projected $12 billion annual revenue loss) and local government’s ability to fund basic services aren’t necessary because the state could potentially cover gaps by using one-time dollars through the state surplus. Meanwhile, the state is projecting a shortfall by the 2029-2030 fiscal year.
• LOUISIANA is giving up at least $23.8 billion via a 25-year property tax break alone for SpaceX to build a new launch facility rural Vermilion Parish. The property tax break is easily the largest tax exemption in Louisiana’s history. SpaceX has committed to creating 3,000 permanent jobs by 2035, at the cost of $8 million per job over 25 years.
• MARYLAND’s new tax on IT services fell short of revenue projections. The new tax on business-to-business IT and data services collected $112.8 million in its first fiscal year, which is 77 percent less than projected. The tax was levied within a broader tax package to help close a $3.3 billion budget shortfall.
• MICHIGAN is preparing to implement its pilot road user charge program, which would begin in February 2027 and last for six months, as the state looks for ways to make up declining gas tax revenue as vehicles become more fuel efficient and electric vehicles become more common.
• A lawsuit in NEW HAMPSHIRE is attempting to strike down a local school district property tax cap ballot question before it is placed before voters in November. The lawsuit argues that the ballot question violates the plaintiffs’ right to vote by presenting a confusing and misleading question that contains fewer choices than the legislature intended. Under the law, all general-election ballots are required to ask voters whether to cap the amount of property tax collected over the next two years and only allowing property taxes to grow at the rate of inflation and the property value of new construction.
• NEVADA leaders are reconsidering the state’s data center tax subsidies, but county-level leaders say they have mostly been left out of discussions.
• OHIO’s gubernatorial candidates both released plans to cut property taxes. Democratic candidate Amy Acton proposed property tax cuts targeted to middle-income, older, and disabled Ohioans by expanding the homestead tax exemption and a tax rebate that’s triggered if a household earns below $132,000 with a home valued below $350,000 and their property tax bills increase by more than 4 percent in a year. Republican candidate Vivek Ramaswamy proposed rolling back property taxes to pre-pandemic levels. He did not specify how the plan would prevent cuts to local police, fire, and education services. He also called on pursuing a statewide funding plan for public education that does not rely on local property taxes.
• OREGON revenue forecasts show the state will have $538 million in additional revenue for the next two-year budget cycle due to strong personal income tax collections. However, the state’s chief economist warned the overall economic outlook has weakened due to ongoing geopolitical instability.
• Many PENNSYLVANIA legislators have voted to repeal a $188.4 million tax break for data centers. Although the measure passed the House, it failed in the Senate. Developers have already donated hundreds of thousands of dollars to leaders in both parties and will continue to use the tax break, which is estimated to cost more than half a billion dollars by 2030.
• VERMONT Gov. Phil Scott ordered agency heads to develop the leanest state budget proposal in nearly a decade, directing agencies to limit increases to about 1 percent that would largely only be enough to cover wage and benefit increases for state employees, as Scott plans to unveil a tax cut plan later this year.

• A new ITEP report examines how the 50 largest cities in the country raise revenue, highlighting the general regressivity of local tax systems and urging local leaders to think creatively about how to create more sustainable and equitable local tax systems.
• Watch an interview with Liz Farmer and ITEP’s research director, Carl Davis, as they discuss the failed attempt to repeal Missouri’s income tax, efforts to cut state property taxes, and forthcoming anti-tax ballot measures.
• A recent piece in Realtor.com discusses how Texas’ lack of personal income tax and high reliance on property taxes contribute to its deeply regressive tax system. “The no personal income tax is really like the nail in the coffin for states when it comes to regressivity,” ITEP senior analyst Neva Butkus says.

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