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1962 Memorandum: Allocation of the Federal Tax Burden [1] (1962)

handle is hein.tera/mallocbufe0002 and id is 1 raw text is: TAX FOUNDATION, INC. Wa,,!hirqon Off ice Boutc.'1 - -~L _ 2_ MEMORANDUM . ALLOCATION OF THE FEDERAL TAX BURDEN F: Uraxy F.) File Since Federal tax collections data do not accurately reflect the tax burden by state, Tax Foundation, in cooperation with other organizations, has developed a special allocation formula to distribute the Federal net budget tax burden by state. This distribution of the Federal budget tax burden as estimated for fiscal l96ft.s shown on Table 1. Tax Foundation has gone a step further in the formula derivation to include trust fund tax receipts in order to distribute the total Federal tax burden by state. The estimates for fiscal !96-Itare shown in Table 2. The bases used for deriving the formulas are shown on Schedule A. Essentially the same method and bases have been used for the derivation of these formulas for the past four years. One purpose for which the Federal budget tax burden estimates can be used is demonstrated in Table 3 which shows the tax cost of Federal grants (excluding highway trust fund grants) to state and local governments. Table 4 shows the tax cost of total Federal grants to state and local governments-- that is, including highway trust aid payments. Further explanation of the formulas--their derivation, uses, and limitations--is contained in Tax Foundation's Tax Review, January 1960 or Tax Foundation's Research Aid No. 3, Allocating the Federal Tax Burden Among the States, April 1957. Tax Foundation, Inc. February, 1962