The tax burden for a state refers to the total amount of taxes paid by residents of the state as a percentage of their income. This can include state and local taxes on income, property, sales, and other types of taxes.
States GDP and income, growth, quality of life increases or declines over the years.
States with the highest tax burdens (2022)*
1. New York (12.75% Tax)
New York is a large, economically diverse state with a gross domestic product (GDP) of over $1.7 trillion. The state has a high cost of living, and its economy is driven by a number of industries, including finance, real estate, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 4% to 8.82%.
- Low income: $24,000
- Median income: $71,000
- High income: $155,000+
- Employment: Approximately 8.6 million people are employed in New York.
2. Hawaii (12.70% Tax)
Hawaii is a small, island state with a GDP of around $75 billion. The state's economy is primarily driven by tourism, with a significant contribution from the military as well. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state has a high cost of living, and its income tax rate is progressive, with rates ranging from 1.4% to 11%.
- Low income: $30,000
- Median income: $75,000
- High income: $150,000+
- Employment: Approximately 650,000 people are employed in Hawaii.
3. Maine (11.42% Tax)
Maine is a small, rural state with a GDP of around $56 billion. The state's economy is driven by a number of industries, including forestry, fishing, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state's income tax rate is progressive, with rates ranging from 5.8% to 10.15%.
- Low income: $30,000
- Median income: $53,000
- High income: $100,000+
- Employment: Approximately 645,000 people are employed in Maine.
4. Vermont (11.13% Tax)
Vermont is a small, rural state with a GDP of around $29 billion. The state's economy is driven by a number of industries, including agriculture, forestry, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state's income tax rate is progressive, with rates ranging from 3.55% to 8.95%.
- Low income: $30,000
- Median income: $58,000
- High income: $110,000+
- Employment: Approximately 360,000 people are employed in Vermont.
5. Minnesota (10.20% Tax)
Minnesota is a large, economically diverse state with a GDP of over $500 billion. The state's economy is driven by a number of industries, including agriculture, manufacturing, and healthcare. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 5.35% to 9.85%.
- Low income: $30,000
- Median income: $69,000
- High income: $135,000+
- Employment: Approximately 3.1 million people are employed in Minnesota.
6. New Jersey (10.11% Tax)
New Jersey is a small, densely populated state with a GDP of around $600 billion. The state's economy is driven by a number of industries, including finance, pharmaceuticals, and telecommunications. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 1.4% to 10.75%.
- Low income: $35,000
- Median income: $80,000
- High income: $165,000+
- Employment: Approximately 4.4 million people are employed in New Jersey.
7. Connecticut (10.06% Tax)
Connecticut is a small, densely populated state with a GDP of around $300 billion. The state's economy is driven by a number of industries, including finance, insurance, and healthcare. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state's income tax rate is progressive, with rates ranging from 3% to 6.99%.
- Low income: $35,000
- Median income: $80,000
- High income: $165,000+
- Employment: Approximately 1.7 million people are employed in Connecticut.
8. Rhode Island (9.91% Tax)
Rhode Island is a small, densely populated state with a GDP of around $60 billion. The state's economy is driven by a number of industries, including healthcare, education, and manufacturing. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state's income tax rate is progressive, with rates ranging from 3.75% to 5.99%.
- Low income: $35,000
- Median income: $70,000
- High income: $135,000+
- Employment: Approximately 515,000 people are employed in Rhode Island.
9. California (9.72% Tax)
California is a large, economically diverse state with a GDP of over $3 trillion. The state's economy is driven by a number of industries, including technology, entertainment, and agriculture. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 1% to 13.3%.
- Low income: $30,000
- Median income: $75,000
- High income: $155,000+
- Employment: Approximately 19.4 million people are employed in California.
10. Illinois (9.70% Tax)
Illinois is a large, economically diverse state with a GDP of over $800 billion. The state's economy is driven by a number of industries, including agriculture, manufacturing, and healthcare. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is flat, with a rate of 4.95%.
- Low income: $30,000
- Median income: $71,000
- High income: $145,000+
- Employment: Approximately 6.1 million people are employed in Illinois.
States with the lowest tax burdens (2022)*
1. Alaska (5.06%)
Alaska is a large, sparsely populated state with a GDP of around $50 billion. The state's economy is driven by a number of industries, including oil, gas, and fishing. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state has no state income tax.
- Low income: $30,000
- Median income: $76,000
- High income: $155,000+
- Employment: Approximately 320,000 people are employed in Alaska.
2. Tennessee (5.75%)
Tennessee is a large, economically diverse state with a GDP of over $600 billion. The state's economy is driven by a number of industries, including healthcare, manufacturing, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state has no state income tax.
- Low income: $30,000
- Median income: $61,000
- High income: $115,000+
- Employment: Approximately 3.1 million people are employed in Tennessee.
3. Delaware (6.22%)
Delaware is a small, densely populated state with a GDP of around $70 billion. The state's economy is driven by a number of industries, including finance, healthcare, and manufacturing. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 2.2% to 6.6%.
- Low income: $35,000
- Median income: $70,000
- High income: $135,000+
- Employment: Approximately 600,000 people are employed in Delaware.
4. Wyoming (6.32%)
Wyoming is a large, sparsely populated state with a GDP of around $30 billion. The state's economy is driven by a number of industries, including mining, agriculture, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state has no state income tax.
- Low income: $30,000
- Median income: $69,000
- High income: $135,000+
- Employment: Approximately 290,000 people are employed in Wyoming.
5. New Hampshire (6.41%)
New Hampshire is a small, densely populated state with a GDP of around $70 billion. The state's economy is driven by a number of industries, including manufacturing, healthcare, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state has no state income tax, but does have a 5% tax on dividends and interest income.
- Low income: $30,000
- Median income: $75,000
- High income: $155,000+
- Employment: Approximately 675,000 people are employed in New Hampshire.
6. Florida (6.64%)
Florida is a large, economically diverse state with a GDP of over $1 trillion. The state's economy is driven by a number of industries, including tourism, agriculture, and healthcare. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state has no state income tax.
- Low income: $30,000
- Median income: $55,000
- High income: $105,000+
- Employment: Approximately 9.3 million people are employed in Florida.
7. South Dakota (7.12%)
South Dakota is a small, rural state with a GDP of around $40 billion. The state's economy is driven by a number of industries, including agriculture, manufacturing, and tourism. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state has no state income tax.
- Low income: $30,000
- Median income: $59,000
- High income: $115,000+
- Employment: Approximately 425,000 people are employed in South Dakota.
8. Montana (7.39%)
Montana is a large, sparsely populated state with a GDP of around $40 billion. The state's economy is driven by a number of industries, including agriculture, tourism, and mining. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 1.5% per year. The state's income tax rate is progressive, with rates ranging from 1% to 6.9%.
- Low income: $30,000
- Median income: $58,000
- High income: $110,000+
- Employment: Approximately 460,000 people are employed in Montana.
9. Alabama (7.41%)
Alabama is a large, economically diverse state with a GDP of over $200 billion. The state's economy is driven by a number of industries, including healthcare, manufacturing, and agriculture. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is progressive, with rates ranging from 2% to 5%.
- Low income: $30,000
- Median income: $53,000
- High income: $105,000+
- Employment: Approximately 2.1 million people are employed in Alabama.
10. Oklahoma (7.47%)
Oklahoma is a large, economically diverse state with a GDP of over $300 billion. The state's economy is driven by a number of industries, including energy, agriculture, and manufacturing. In recent years, the state's economy has grown at a moderate pace, with GDP increasing by around 2% per year. The state's income tax rate is flat, with a rate of 5%.
- Low income: $30,000
- Median income: $57,000
- High income: $110,000+
- Employment: Approximately 1.7 million people are employed in Oklahoma.
Factors such as the availability of jobs, the level of education and training in the workforce, and the quality of infrastructure can all have a significant impact on a state's overall economic performance and quality of life.
It's also worth noting that the cost of living in a state can have a significant impact on a person's overall financial situation. For example, a state with a lower tax burden may have a higher cost of living, which could offset the benefit of lower taxes for residents. Similarly, a state with a higher tax burden may have a lower cost of living, which could make the overall financial burden on residents more manageable.
In general, states with higher tax burdens tend to have higher levels of public services and infrastructure, while states with lower tax burdens may have fewer public services and lower levels of spending on education, health care, and other areas.
The ranking of states by tax burden can vary depending on the source of the data and the specific taxes included in the calculation.
*This data is from 2022, CNBC.
