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States Where People Pay the Most (And Least) in Taxes: NJ highest, NY 2nd highest, AK Lowest, TX 6th lowest!

August 25, 2011

Government Spending Uncle SamStates Where People Pay the Most (And  Least) in Taxes

Published July 21, 2011 By Charles B. Stockdale,  Michael B. Sauter &  Douglas A. McIntyre – 24/7 Wall St.

Different states tax their residences at different  levels. 24/7 Wall St. reviewed a report recently released by  the Tax Foundation to identify the states where residents paid the most and  least in state and local taxes as a percent of income.

Read the full report at Read the story on 24/7 Wall St.

Top 10 States with the Highest Tax Burdens:

#1. New Jersey

2. New York
> Taxes paid by residents as  pct. of income:
12.1%
> Total state and local taxes collected: $243.9 billion
> Pct. of total taxes paid by residents: 71.4%
> Pct. of total taxes paid by non-residents: 28.6%
New  York places much of its tax burden on residents from other states. Consider, for  example, the amount of state revenue derived from New York City tourism, or  those who commute to the city for work. Despite this, state residents maintain  the second largest tax burden in the country. The state has one of the highest  state and local tax collections per capita, an average of $6,884. It has one of  the highest combined averages local and state sales tax rates — 8.3%. The Big  Apple also has a number of exceptionally high excise taxes, such as its $4.35  tax on each pack of cigarettes, the highest rate in the country. Additionally,  the state has exceptionally high property tax rates. According to the Census  Bureau, the top ten counties in the U.S. with the highest property taxes as a  percentage of home values are all in New York.

3. Connecticut

4. Wisconsin

5. Rhode Island

6. California

7. Minnesota

8. Vermont

9. Maine

10. Pennsylvania

Top Ten States with the Lowest Tax  Burdens:

#1. Alaska ***
> Taxes paid by residents as pct. of income:
6.3%
> Total state and local taxes collected:
$18.8 billion
> Pct. of  total taxes paid by residents: 20.5%
> Pct. of total taxes paid by non-residents: 79.5%
Alaskans have the lowest tax burden of any state in  the country, paying just 6.3% of their income in state and local taxes. This is  over one full percentage point lower than the state with the second smallest tax  burden. According to the Tax Foundation, “Before the Trans-Alaska pipeline was  finished in 1977, taxpayers in Alaska bore the second-highest tax burden in the  country. By 1980, with oil tax revenue pouring in, Alaska repealed its personal  income tax and started sending out checks instead. The tax burden plummeted, and  now Alaskans are the least taxed.” The state also levies no personal income tax  or sales tax.

2. Nevada

3. South Dakota

4. Tennessee

5. Wyoming

6. Texas ***
> Taxes paid by residents as pct.  of income:
7.9% ←
> Total state and local taxes collected: $196.5  billion
> Pct. of total taxes paid by residents: 63.4%
>  Pct. of total taxes paid by non-residents: 36.6%
The population of Texas  is 30% larger than New York, but collects more than 60% less in tax revenue than  the Empire State. The tax burden on residents is the sixth lowest in the  country, at just 7.9% of average income per resident. The biggest reason for  this is that the state is one of just six in the country to levy no personal  income tax. Texas also has the 11th lowest sales tax, at 7.39%, and average or  below average rates on gasoline, cigarettes and alcohol.

7. New Hampshire

8. South Carolina

9. Louisiana

10. New Mexico

*** Gov Palin, Gov Perry

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