State Tax Assessment
Friday, April 23, 2004
State and Local Tax Burdens 2004
"Each state’s total tax burden (taxes as a percentage of income) is a combination of federal, state, and local taxes. It can be instructive, however, to strip out the federal tax burden and compare just the tax burdens of states and localities.
Follow each row [of the accompanying table] to see how a state's ranking changes when federal taxes are added back in. Generally, high-income states rise because, with their high costs of living and commensurately higher salaries, they are hit harder by the progressive federal income tax. Low-income states that have high state-local tax burdens fall in the ranking when federal taxes are added in."
COMMENT:
In case our posting of Tax Freedom Day 2004 didn't impress you, here is another way of looking at federal, state and local taxes borne by taxpayers. On average, we pay 10 percent of our incomes in the form of state and local taxes, including sales, income and property taxes. We pay an additional 18 percent of our incomes to the federal government.
Add those two figures together, and we pay 28 percent of our incomes in various taxes. That's more than one quarter of our incomes: more than many of us spend on housing, food or transportation. No wonder Tax Freedom Day occurred on April 11, which was 102 days or 28 percent into the year 2004.
Tuesday, April 20, 2004
Tax Freedom Day 2004
"According to Tax Foundation calculations using the latest government data on income and taxes, Tax Freedom Day® in 2004 will be celebrated on April 11th, the earliest Tax Freedom Day for 37 years.
April 11th is three days earlier than 2003’s Tax Freedom Day of April 14 and an amazing 21 days earlier than in 2000, when the boom and bubble pushed tax burdens to a record high, and Tax Freedom Day was postponed until May 2."
COMMENT:
Tax Freedom Day is the day when Americans have earned enough money to pay their total tax bill for the year. Of course, this varies greatly by state.
For example, Tax Freedom Day in Alaska was March 26. In Alabama, Tennessee and South Carolina, it was April 1. Oklahoma, Mississippi, Louisiana, and South Dakota all celebrated Tax Freedom day on April 2, while North Dakota and Iowa celebrated on April 3.
Contrast those dates with California and Nevada (April 13), Wyoming (April 14), Maine and Washington (April 15), Rhode Island (April 16), Massachusetts (April 18), New Jersey (April 19), New York (April 27) and Connecticut (April 28).
