24/7 Wall Street: 10 States with the Worst Tax Averages for Americans

When looking at taxes paid as a share of the income earned, all states have a regressive tax system, which means poorer residents are taxed more than the wealthiest ones. The difference in effective tax rates between income groups, however, varies widely between states. According to “Who Pays? A Distributional Analysis of the Tax Systems in All 50 States,” a report released by the Institute on Taxation and Economic Policy (ITEP), Washington has by far the most regressive tax system nationwide. Based on the index score, a ratio calculated from a range of factors to measure income inequality before and after taxes, these are the states with the most unfair tax systems for the average American.

In fact, the poorest 20% of individuals paid at least 12% of their total incomes in state and local taxes in seven of the 10 states with the most regressive tax systems. In contrast, the wealthiest 1% of residents paid no more than 3% in state and local taxes as a share of income in six of the 10 states. In an interview with 24/7 Wall St., Meg Wiehe, state tax policy director at ITEP, said that in most states, and these 10 especially, “tax distribution looks very much like a staircase going down, where as your income goes up, your effective tax rate goes down.”

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