July 3, 2019

Which States Have the Highest Tax Rates for Low-income People?


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No two state tax systems are the same, but 45 states have one thing in common: Low-income residents are taxed at a higher rate than the top 1 percent. Effective tax rates for the lowest-income 20 percent of families range from a high of 17.8 percent in Washington to a low of 5.5 percent in Delaware.

Many states with low-tax reputations are high-tax for the poor, including Texas and Florida which both rank among the 10 highest-tax states for low-income families. States with a high reliance on sales and excise taxes often require the poor to pay much more than the rich, while states with progressive income taxes and robust low-income tax credits often achieve lower tax rates on struggling families.

Read More:

Low-Tax States Are Often High-Tax for the Poor

Who Pays? A Distributional Analysis of the Tax Systems in All 50 States (Sixth Edition)