Democratic presidential candidate Hillary Clinton has proposed a change in the top capital gains tax rates. Under current law, such capital gains have a two-tiered structure: short-term gains face a top rate of 43.4...
- The Tax Policy Blog
- New Report: Sources of State Tax Revenue
New Report: Sources of State Tax Revenue
- Property taxes make up the largest portion of combined state and local government tax revenue at 35%, with sales and gross receipts taxes close behind at 34%.
- The corporate income tax brings in the smallest amount of any major tax, providing only about 3% of the tax revenues taken in by state and local tax collectors.
- States vary widely on how heavily they rely on the various tax categories. New Hampshire receives almost 65% of its total state and local tax revenue from property taxes, while Arkansas receives less than a fifth of its tax revenues from the same source. (View the report for a table containing each state's sources.)
- The composition of all state and local revenue has also shifted significantly over time. A century ago, property taxes provided over 80% of all state and local government tax revenues, while in recent decades that proportion has fallen to around a third of total tax receipts. The corporate income tax rose from nonexistent in 1913 to raising 6% of state and local tax revenue in 1980, only to fall back to 3.4% in fiscal year 2010.
- The data, taken from U.S. Census figures for 2010, looks just at state and local tax revenue ($1.269 trillion). It does not include $608 billion in non-tax revenues (interest and user fees including tolls and tuition), $623 billion in federal aid, and $669 billion in enterprise revenues (primarily pension funds but also liquor store revenue). A future report will cover these topics.
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The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.