HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » Forums & Groups » Main » General Discussion (Forum) » Study: Poor families pay ...

Wed Jan 14, 2015, 12:43 PM

 

Study: Poor families pay double the state, local tax rate of the rich

Middle- and low-income Americans are facing far higher state and local taxes than the wealthy, according to a new report assessing tax data from all 50 states. In all, the analysis by the nonpartisan Institute on Taxation and Economic Policy (ITEP) finds that the poorest 20 percent of households pay on average more than twice the effective state and local tax rate (10.9 percent) as the richest 1 percent of taxpayers (5.4).

ITEP researchers say the incongruity derives from state and local governments’ reliance on sales, excise and property taxes rather than on more progressively structured income taxes that increase rates on higher earnings. They argue that the tax disconnect is helping create the largest wealth gap between the rich and middle class that has ever been recorded in American history.

“In recent years, multiple studies have revealed the growing chasm between the wealthy and everyone else,” Matt Gardner, executive director of ITEP, said. “Upside-down state tax systems didn’t cause the growing income divide, but they certainly exacerbate the problem. State policymakers shouldn’t wring their hands or ignore the problem. They should thoroughly explore and enact tax reform policies that will make their tax systems fairer.”

The 10 states with the largest gap between tax rates on the rich and poor are a politically and geographically diverse group -- from traditional Republican bastions such as Texas and Arizona to Democratic strongholds such as Illinois and Washington. The latter state, reports ITEP, is the most regressive of all, imposing a 16.8 percent effective tax rate on its poorest 20 percent, while letting its 1-percenters pay just a 2.4 percent rate. Four of the top 10 most regressive states levy no personal income tax at all.

By contrast, the states identified as having the smallest gap in tax rates are California, Delaware, Minnesota, Oregon and Vermont -- all Democratic strongholds and all relying more heavily on progressively structured income taxes. Montana is the only Republican-leaning state ITEP researchers identify among the states with the least regressive tax rates.

http://www.msn.com/en-us/money/taxes/study-poor-families-pay-double-the-state-local-tax-rate-of-the-rich/ar-AA89Iu0?ocid=iehp

8 replies, 2059 views

Reply to this thread

Back to top Alert abuse

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread

Response to ND-Dem (Original post)

Wed Jan 14, 2015, 12:51 PM

1. So what else is new?

They also pay less than us for banking, insurance and everyday goods.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to Cleita (Reply #1)

Wed Jan 14, 2015, 02:47 PM

6. Lower Interest Rates, as well

I've been hammering this theme for quite some time now.
There has been this great tax transfer, as the rich have gotten huge tax cuts, from 91% down to 28-40% (has varied), the poor have had higher sales, gas, cigarette, utility, fees, tickets, fines, FICA/SS (1983), property taxes in addition to the mentioned State taxes (assuming they didn't include all of these others).

We need to look at these as a "percentage of income," rather than just generally see them as "needed taxes." As a percentage of income, these taxes REAM the poor, hurt the middle badly, and don't really affect those who make over 100K a year. Recently here in Mobile, four taxes have been suggested, one for a toll if I-10 gets built, a new bridge. A sales tax increase was passed, I've heard tell of increases in gas taxes, AND of all things, they're running around threatening to "ticket" people for not raking yards promptly. There is a lot of (tax) gold to mine in fees, fines, and tickets.

We all need to recognize that taxes do NOT need to connect to whatever they're going to be spent for, like gas taxes don't have to be raised for highway work. That money can come from anywhere.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to liberalmike27 (Reply #6)

Wed Jan 14, 2015, 02:50 PM

7. Yes, yes. It's not even worth having a savings account anymore or buying CDs. eom

Reply to this post

Back to top Alert abuse Link here Permalink


Response to ND-Dem (Original post)

Wed Jan 14, 2015, 02:01 PM

2. Reads like a future history book that future people will gasp about.

Illogicity is a plague in these absurd days.

At this point one hopes there will be a future, I suppose.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to byronius (Reply #2)

Wed Jan 14, 2015, 02:17 PM

4. at this point the tide of history is running the opposite way. hopefully it will change again

 

before I die. that would make me happy.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to ND-Dem (Original post)

Wed Jan 14, 2015, 02:15 PM

3. But the 47% who pay no Federal Income Tax are "takers"!

So they pay proportionately way MORE in state and local taxes--still takers! And don't get me started on the FICA cap.
Looking forward to Romney running again to bring this topic back up.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to ND-Dem (Original post)

Wed Jan 14, 2015, 02:28 PM

5. Like everything else, it all comes down to the rich who donate (bribe) the politicians to get

everything they want, at the expense of the 99%!!!
We need to support Bernie Sanders who is calling for Publicly Funded Elections and an end to campaign donations! If you are a true Progressive or Democrat you will give up on the corporate wing of the Party and fight the root problem corrupting our government. If we can get the masses to realize that there is a way to fix our problems we can do this! I know that it is an uphill battle, but things like Climate Change will not wait for us to get our crap in order!

Reply to this post

Back to top Alert abuse Link here Permalink


Response to ND-Dem (Original post)

Wed Jan 14, 2015, 03:21 PM

8. Perhaps a mandatory tax on elections

I think that we should impose a small surtax on income to publicly fund elections.

Reply to this post

Back to top Alert abuse Link here Permalink

Reply to this thread