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The Tax Foundation is the nation’s
leading independent tax policy
research organization. Since 1937,
our research, analysis, and experts
have informed smarter tax policy
at the federal, state, and global
levels. We are a 501(c)(3) nonprofit
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State Tax Changes Effective
January 1, 2022
• Twenty-one states and the District of Columbia had significant tax changes
take effect on January 1, 2022
• Five states (Arizona, Arkansas, Louisiana, North Carolina, and Oklahoma) cut
individual income taxes effective January 1. The District of Columbia was the
only jurisdiction to increase income taxes.
• Four states (Arkansas, Louisiana, Nebraska, and Oklahoma) saw corporate
income tax rates decrease. Florida is the only state to increase corporate
income tax rates, as a temporary reduction expired.
• Five states (Arizona, Colorado, Georgia, Illinois, and Oregon) implemented
a pass-through entity election to serve as a workaround to the federal state
and local tax (SALT) deduction cap.
Iowa is phasing out its inheritance tax, while Maryland and Washington
face litigation over new taxes on digital advertising and capital gains income
Senior Policy Analyst
TAX FOUNDATION | 2
States, as Justice Louis Brandeis once wrote, are the laboratories of democracy,1 and those
laboratories have been remarkably busy in recent years as, 90 years since Justice Brandeis coined the
phrase, states continue to produce unique responses to policy challenges and opportunities.
As the nation enters 2022, 21 states and the District of Columbia have significant tax changes taking
effect. Some states have chosen to respond to budget surpluses associated with the pandemic