There are five basic legal forms of business structures found in the United States: C corporations, S corporations, sole proprietorships, partnerships, and Limited Liability Companies (LLCs). In order to understand...
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- Star-Ledger Letter to the Editor
Star-Ledger Letter to the Editor
The following letter to the editor was submitted to New Jersey's Star-Ledger on April 14:
In an April 4 op-ed published in the Star-Ledger, Mary Forsberg of New Jersey Policy Perspective argues that New Jersey residents are not over-taxed. On the 9th the Star-Ledger ran a response from the Tax Foundation's Justin Higginbottom arguing the opposite.
The same day Star-Ledger editor Tom Moran asked us to verify Forsberg's numbers, and although we confirmed her sales and property tax rankings using standard data from the Census and the Bureau of Economic Analysis, there was one obviously wrong number: her ranking of New Jersey as 28th for total state and local taxes as a percent of income.
We told Mr. Moran that using standard Census data, New Jersey ranks 7th when total state-local tax collections are divided by the state's personal income. This result is confirmed by data provided by the Tax Policy Center.
Mr. Moran ignored the research and instead published an editorial April 11 criticizing the Tax Foundation and citing Forsberg's 28th place ranking for New Jersey with no mention of a dispute. Perhaps Ms. Forsberg or Mr. Moran will eventually clarify for Star-Ledger readers what acrobatic math was used to generate that wishful-thinking 28th place finish for New Jersey.
Mr. Moran has refused to publish the letter, even after we removed a portion that he felt was inaccurate: the reference to Mary Forsberg's claim that New Jersey residents are not over-taxed.
In an email Ms. Forsberg confirmed that all her data comes from the same source, 2007 Census State and Local Government Finances, and 2007 Bureau of Economic Analysis State Personal Income, but she did not share how she arrived at her results for total state and local tax collections as a percent of personal income.
It should not be difficult to replicate her results; it is just a matter of dividing total taxes by population (for the per capita measure) and by total personal income (for the percent-of-income measure). But we were unable to replicate her results for the 'total state and local tax collections' category. Our calculations arrived at a ranking of 5th per capita and 7th as a percent of income (rankings exclude DC). We checked our results with the Tax Policy Center's database and arrived at the same conclusion.
It seems that the 28th rank is a mistake. It would be very easy to get to bottom of this discrepancy, yet Tom Moran doesn't seem eager.
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