Analysis

Just Like Texas, California Is Rated 'Tax Friendly'

Published

6 years ago

October 8, 2019

gvwire

composite illustration of california and texas scenes

Spread the love

Kiplinger, a personal finance publication, has assembled a detailed summary of state taxes on income, property, and everything you buy.
While not landing among the Top 10 most-tax friendly states, California received Kiplinger’s “tax-friendly” designation — the same as its big economic rival, Texas.
“The Golden State’s reputation as a high-tax destination is built in part on how aggressively it goes after big earners, with a 13.3% tax rate that kicks in at $1 million (for single filers) of taxable income,” Kiplinger said. “But for more modest incomes, the impact is far milder, and property taxes are low. Still, Californians pay high sales taxes, as well as a high fuel taxes on all that driving they have to do.”
And here’s what Kiplinger says about Texas: “The Lone Star State is a place of extremes. There’s no income tax at all. On the other hand, sales taxes run high, as do property taxes.”
You can read the Kiplinger state-by-state guide to taxes at this link.

Mineral, Energy Production Keep Wyoming Taxes Low

Kiplinger rated Wyoming as the most tax-friendly state.
“One reason why Wyoming tops our tax-friendly list is because generous revenues from mineral and energy extraction continue to flow into the state,” Kiplinger analyzes. ” There is no income tax in Wyoming, and its gas tax is well below the national average of 31.7 cents per gallon. The state’s combined state and average local sales tax rate is also the third-lowest of all the states with a sales tax. And at 2 cents per gallon, Wyoming has the lowest beer tax in the U.S.”
[rlic_related_post_one]

Illinois Is a Basket Case

Meanwhile, Illinois has the dubious distinction of being the least tax-friendly state in the Union.
According to the Mercatus Center at George Mason University, Illinois also ranks last in fiscal health.
Certainly, its tax rates do residents no favors. For example, the yearly property tax on a $400,000 home is $9,634.
[rlic_related_post_two] US Map of states based on tax friendliness