Alabama ranked No. 10 with an annual per capita tax of $3,147, or 7.37% of income. Georgia was the 14th lowest with an annual per capita tax of $3,678, or 7.84% of income.
Tennessee has one of the lowest state and local tax burdens of any state in the country.
A new study by HireHelper comparing taxes in all 50 states found that Tennessee was second only to Alaska in the share of personal income individuals pay in state and local property, sales and income taxes. The amount paid by the typical Tennessean in state and local taxes totaled $2,694 in 2018, which was was 44.4% lower than the national average and the lowest of any state, according to data from the U.S Census Bureau's most recent Annual Survey of State and Local Government Finances.
The typical Tennessean paid 5.7% of his or her income in property, sales and other state and local taxes, compared with a national average of 8.9% of personal income going for such taxes. Only Alaska, which in some years has been able to generate up to 70% of its state budget through the taxation of oil and natural gas production, tax individuals at a lower share of their income.
Tennessee Gov. Bill Lee, who was elected two years ago on a campaign pledge to keep Tennessee taxes low, said he is proud of the recognition as a low-tax state and insisted taxes can be kept low "while maintaining a high level of service" to Tennessee taxpayers.
"Lower taxes lead to job creation, prosperous communities, and more money in the pockets of hardworking Tennesseans.," he said.
The conservative Nashville think tank the Beacon Group credits Tennessee's low tax burden for its above-average economic growth rate in recent years.
"There is a reason Tennessee is one of the fastest-growing states in the country and people from Illinois, New York, California, and others are fleeing here," said Ron Shulis, Beacon's policy director. "Tennessee's commitment to low taxes and reasonable regulations has created an economic environment that is attractive to both businesses and workers."
States with the lowest tax burden
1. Alaska, 5.04% - annual tax burden of $3,030 per persons
2. Tennessee, 5.7% - annul tax burden of $2,694 per person
3. Wyoming, 6.11% - annual tax burden of $3,709
4. Delaware, 6.17% - annual tax burden of $3,260
5. New Hampshire, 6.83%- annual tax burden of $4,192
Source: HireHelper study of state and local tax burdens
Alabama ranked No. 10 with an annual per capita tax of $3,147, or 7.37% of income. Georgia was the 14th lowest with an annual per capita tax of $3,678, or 7.84% of income.
Matt and Kelly Rozanski are among those enjoying Tennessee's lower tax rates after they moved to Jasper Highlands near Kimball, Tennessee from the previous homes in Illinois where they paid more than $12,000 in annual property tax bills. Without a state income tax and far lower property tax rates than what they previously paid on their homes in Naperville and Lockport, Illinois, the Rozanskis are now paying only a portion of what they used to shell out for state and local taxes.
But others are skeptical that lower taxes necessarily mean higher economic growth
"Preserving and enhancing states' investments in education, health care, roads, bridges, parks, and other infrastructure will do far more to boost inclusive economic growth and the well-being of their residents than will cutting income taxes," Michael Mazerov, a senior fellow at the Center on Budget and Policy Priorities, said in a study of state taxes last year.
Tennessee spends the 7th lowest amount of all 50 states on elementary and secondary education and Tennessee's median household income is still 15.2% less than the U.S. average
Tennessee is one of nine states that does not tax payroll income and, starting on Jan. 1, the Volunteer State will have fully repeated the Hall Tax on interest and dividend income. The Hall Tax was instituted in 1929 and applied a 6 percent tax to Tennesseans' interest and dividend income.
Beacon Center CEO Justin Owen said with the end of the Hall tax on Friday, "Tennessee will finally become truly income tax-free."
Tennessee is able to avoid a state income or payroll tax, in part, by having relatively higher sales taxes on most items, including food, and an above-average franchise and excise tax on businesses operating in the state. Tennessee has a 7% statewide sales tax and allows local governments to add up to 2.75% more on top of the state levy.
Sales taxes are paid, in part, by visitors who come to the tourist-oriented state and some of the franchise and excise tax captures revenues major corporations generate within Tennessee.
Bill Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee, said the Volunteer State has also been recognized for operating a more efficient state government with less per capita debt than in most states. Tennessee also has been able to turn to outside funding sources such as the state-run lottery and a nonprofit support group to help pay for a tuition support program for higher education in Tennessee, Fox said.
"It seems to me that Tennessee does a pretty good job of delivering services within a low-tax environment and it has been recognized for its fiscal discipline and creativity in meeting challenges for many years," he said. "Among states in the Southeast, we have consistently been an economic growth leader among those states not on the coast and sometimes even better than those states on the coast."
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340.
"share" - Google News
December 29, 2020 at 09:03AM
https://ift.tt/3aPFPB2
Tennesseans pay second-lowest share of income in state and local taxes of any state - Chattanooga Times Free Press
"share" - Google News
https://ift.tt/2VXQsKd
https://ift.tt/3d2Wjnc
Bagikan Berita Ini
0 Response to "Tennesseans pay second-lowest share of income in state and local taxes of any state - Chattanooga Times Free Press"
Post a Comment