Special Report

States Collecting the Most Income Tax Per Person

When the U.S. hunkered down in 2020 because of the pandemic, it wasn’t just retail sales that suffered a major blow. States also saw overall tax revenues decline. The Tax Foundation reports state tax collections dropped 5.5 percent nationwide in FY 2020, driven mostly by a “dismal” final quarter (April through June). 

State tax revenues include not only individual income taxes, but also corporate taxes, state property taxes, general sales taxes, and other taxes (excise taxes on gas, cigarettes, gaming, and alcohol, to name a few), too. Individual state income taxes plunged 10.1% year-over-year between FY 2019 and FY 2020, and 38.7% when compared to the previous final quarter. 

However, the foundation points out the 10.1 percent drop may be “dramatically overstated” because most states postponed the tax filing deadline from April to July, meaning a good chunk of tax revenues will show up in the next fiscal year, which begins July 1.

How much you pay in state income taxes depends on where you live. Washington, Alaska, Nevada, South Dakota, Texas, Florida, and Wyoming levy none. Those states’ revenues derive either from property taxes or a general sales tax. (This is the state with the highest property taxes.)

Click here to see the states collecting the most income tax per person.

Meanwhile, residents in some states pay a hefty amount to their governments. New York (no surprise) collects the most in state income taxes at $2,791 per capita. It’s followed by California (again, no surprise) at $2,533. The Golden State’s high taxes and high cost of living are likely among the main reasons Californians are fleeing the state. (California recorded a decrease of 0.46% in population from January 2020 to January 2021). These are the states where Americans are paying the most taxes.

To identify the states collecting the most income tax per person, 24/7 Wall St. reviewed the Tax Foundation’s Facts and Figures dataset for 2021. Income per capita and the state’s top source for tax revenue was also taken from the Facts and Figures.  

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