Tax Freedom Day Approaches – A Look At States By Tax Burdens

Tax Freedom Day Approaches – A Look At States By Tax Burdens

With a week remaining until Tax Day and many Americans finding the current tax code too confusing to determine exactly how much their home states are actually taking from their income in taxes, the personal finance website WalletHub conducted an in-depth analysis of 2016’s States with the Highest & Lowest Tax Burdens.

In order to determine which states tax their residents most aggressively, WalletHub’s analysts compared the tax burdens of the 50 states by measuring property taxes, individual income taxes, and state and gross receipts taxes — the three components of state tax burden — as percentages of the total personal income in each state.

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States with the Highest Tax Burdens (%) States with the Lowest Tax Burdens (%)
1 New York (13.12%) 41 Texas (7.67%)
2 Hawaii (11.86%) 42 Wyoming (7.62%)
T-3 Maine (11.13%) 43 Alabama (7.41%)
T-3 Vermont (11.13%) 44 Florida (7.22%)
5 Connecticut (10.91%) 45 Oklahoma (6.95%)
6 Minnesota (10.46%) 46 South Dakota (6.94%)
7 New Jersey (10.38%) 47 New Hampshire (6.88%)
8 Rhode Island (10.36%) 48 Tennessee (6.56%)
9 Wisconsin (10.32%) 49 Delaware (5.91%)
10 Illinois (10.19%) 50 Alaska (5.18%)

Comparing the States

  • Red states have a lower total tax burden, with an average rank of 32.00, compared with Blue states, which have an average rank of 19.38. (The lower the rank, the higher the burden)
  • New Jersey has the highest property tax as a fraction of personal income, 5.41 percent, which is four times higher than in Oklahoma, the state with the lowest, 1.42 percent.
  • New York and Oregon have the highest individual income taxes as a fraction of personal income, 4.76 percent and 4.04 percent respectively, whereas Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming do not levy such a tax.
  • Hawaii has the highest total sales and gross receipts tax as a fraction of personal income, 6.95 percent, which is six times higher than in Oregon, the state with the lowest, 1.15 percent.

For the full report and to see where your state ranks, please visit:

Tax Freedom Day