WalletHub, borrowing data from the Institute on Taxation and Economic Policy, has attempted to determine the most fair — and the least fair — state tax systems. Admittedly, mine eyes glazeth over at the presence of “fair” and “tax system” in the same sentence, but I figured I wouldn’t come down with glaucoma from reading their pitch, and if I did, well, I have friends in Colorado.
Oklahoma shows up at #29, about where I expected; the state, says the report, is not overly dependent on property or income taxes, but makes up the difference in sales tax and some of our state-specific Wacky Fees. By this reckoning, the fairest of them all is Montana; bottom of the list is Washington state, which lacks an income tax altogether but which will kill you, or at least maim you, with sales tax. Looking at quintiles, Washington is 7th in undertaxation of the top 20 percent, and first in overtaxation of the bottom 20. (How they rank for glaucoma, I have no idea.)
I was at least somewhat alarmed when I noticed that WalletHub also ran an opinion poll, mostly because I, like most Americans, tend to think other people’s opinions of taxes aren’t worth diddly. I was not surprised, though, to see fairly universal support for a progressive (in the numerical sense) income tax:
Although conservatives appear to support higher taxes on the poor and lower taxes on the rich, the general trend is the same: all Americans believe a fair state and local tax system taxes wealthy households at a higher rate than lower- and middle-income households.
The bottom of the “poor” scale, for this purpose, is an annual income of $5,000; “rich” tops out at $2.5 million. But even the economic liberals quail at more than a 20% impost on the wealthiest, and are willing to accept a percentage point or two at the low end. Somewhere between $30k and $50k, the curves cross.
And this is where it gets interesting. Presented with the hard ITEP data, both sides awarded Montana the top slot, both picked Washington for the bottom, and both left Oklahoma at #29. I conclude that my opinion of taxes is likely worth as little diddly as anyone else’s.
(Roger Green found this.)