CFED Assets & Opportunity Scorecard
Tax Burden by Income
Definition
Ratio of the effective state tax rate for families in the bottom income quintile to families in the top one percent income bracket, 2013. The tax rate is the total average state and local taxes as a percentage of income.
Description
States have the flexibility to design their own tax rates and structures to fund public services. Most states rely on three types of taxes: personal income, property and consumption (sales and excise) taxes. Whether the state’s tax system is regressive (taxes the poor more heavily than the rich) or progressive (taxes the rich more heavily than the poor) depends, in part, on how much the state relies on each of these three types of taxes. Income taxes are usually progressive, whereas property taxes and consumption taxes are usually regressive. In almost all states, the poor pay a higher proportion of their income in taxes than wealthy residents do.
For more information, visit the Institute on Taxation and Economic Policy's new site, whopays.org.
Tax Burden by Income
| Taxes Paid as a Percent of Income (%) 1 | |||
|---|---|---|---|
| State | Poorest 20% | Top 1% | Ratio |
| Alabama | 10.2% | 3.8% | 2.7 |
| Alaska | 7.0% | 2.4% | 2.9 |
| Arizona | 12.9% | 4.7% | 2.7 |
| Arkansas | 11.9% | 6.0% | 2.0 |
| California | 10.6% | 8.8% | 1.2 |
| Colorado | 8.9% | 4.6% | 1.9 |
| Connecticut | 11.0% | 5.5% | 2.0 |
| Delaware | 5.7% | 4.2% | 1.4 |
| District of Columbia | 6.6% | 6.3% | 1.0 |
| Florida | 13.2% | 2.3% | 5.7 |
| Georgia | 11.3% | 4.9% | 2.3 |
| Hawaii | 13.0% | 8.0% | 1.6 |
| Idaho | 8.2% | 6.4% | 1.3 |
| Illinois | 13.8% | 4.9% | 2.8 |
| Indiana | 12.3% | 5.4% | 2.3 |
| Iowa | 10.9% | 6.0% | 1.8 |
| Kansas | 10.3% | 3.9% | 2.6 |
| Kentucky | 9.1% | 5.7% | 1.6 |
| Louisiana | 10.6% | 4.6% | 2.3 |
| Maine | 9.6% | 6.9% | 1.4 |
| Maryland | 9.7% | 6.4% | 1.5 |
| Massachusetts | 10.0% | 4.9% | 2.0 |
| Michigan | 9.7% | 5.8% | 1.7 |
| Minnesota | 8.8% | 6.2% | 1.4 |
| Mississippi | 10.4% | 5.4% | 1.9 |
| Missouri | 9.6% | 5.4% | 1.8 |
| Montana | 6.4% | 4.7% | 1.4 |
| Nebraska | 10.9% | 5.8% | 1.9 |
| Nevada | 9.0% | 2.4% | 3.8 |
| New Hampshire | 8.6% | 2.4% | 3.6 |
| New Jersey | 11.2% | 7.0% | 1.6 |
| New Mexico | 10.6% | 4.8% | 2.2 |
| New York | 10.0% | 6.9% | 1.4 |
| North Carolina | 9.8% | 6.5% | 1.5 |
| North Dakota | 9.2% | 3.6% | 2.6 |
| Ohio | 11.6% | 6.3% | 1.8 |
| Oklahoma | 10.3% | 4.6% | 2.2 |
| Oregon | 8.3% | 7.0% | 1.2 |
| Pennsylvania | 12.0% | 4.4% | 2.7 |
| Rhode Island | 12.1% | 6.4% | 1.9 |
| South Carolina | 7.1% | 5.0% | 1.4 |
| South Dakota | 11.6% | 2.1% | 5.5 |
| Tennessee | 11.2% | 2.8% | 4.0 |
| Texas | 12.6% | 3.2% | 3.9 |
| Utah | 9.4% | 5.0% | 1.9 |
| Vermont | 8.7% | 8.0% | 1.1 |
| Virginia | 8.6% | 4.9% | 1.8 |
| Washington | 16.9% | 2.8% | 6.0 |
| West Virginia | 8.7% | 6.3% | 1.4 |
| Wisconsin | 9.6% | 6.9% | 1.4 |
| Wyoming | 8.2% | 1.6% | 5.1 |
Source
Who Pays? A Distributional Analysis of the Tax Systems in All 50 States, Fourth Edition. Washington, DC: Institute on Taxation and Economic Policy, 2013.
Footnotes
1. Income quintiles do not include elderly families because state tax systems often treat elderly families very differently from other families. Data on income and taxes from 2010 but includes the impact of tax changes through January 2, 2013.
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