Understanding the Tax Load in Each State of the US
A Visualization of the Total Tax Burden
This article presents a map graphic that illustrates the overall tax burden in every U.S. state as of March 2024. The data used to create this visualization was collected by WalletHub. It's crucial to note that the tax burden, as calculated in this methodology, represents the percentage of an individual's average income that goes towards state and local taxes. This includes property taxes, income taxes, and sales & excise tax.
The Data and Methodology
The data used to construct this graphic is presented in the table below. The table shows the total tax burden for each state, with New York having the highest at 12.0% and Alaska having the lowest at 4.9%.
Breaking Down the Tax Burden
The data reveals that New York has the greatest total tax burden. On average, residents in this state will contribute 12% of their income to state and local governments. When broken down into its three components, the average New Yorker pays 4.6% of their income on income taxes, 4.4% on property taxes, and 3% in sales & excise taxes.
Conversely, Alaska has the lowest tax burden of any state, equating to 4.9% of income. This is partially due to the fact that Alaskans do not pay state income tax.
States with No Income Tax
Besides Alaska, several other U.S. states do not levy income taxes. These include Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. It's also noteworthy to mention that New Hampshire does not have a regular income tax, but does charge a flat 4% on interest and dividend income according to the Tax Foundation.
Final Thoughts
If you found this post informative, you might also be interested in this graphic which ranks the countries with the lowest corporate tax rates, from 1980 to today.
This article provides a unique perspective on the tax burden across the United States. It's interesting to see how different states approach taxation and how that impacts the residents. What are your thoughts on this? Do you think the tax burden in your state is fair? Share this article with your friends and let's start a conversation. Don't forget to sign up for the Daily Briefing, which is delivered every day at 6pm.
