State and Local Tax Burdens Fall as Revenues Shrink Faster than Income

February 23, 2011

Combined state and local tax burdens fell slightly in fiscal year 2009, as taxes shrank faster than income due largely to a slower economy, according to our new State-Local Tax Burdens report released this morning.

The nation as a whole paid 9.8% of its income in state and local taxes, down slightly from 9.9% in 2008 and down significantly from 10.4% in 1977, the earliest year for which the Tax Foundation has done such measurements. While it is useful and informative to look at the national trend, burdens among the states can vary widely. Taxpayers in high-tax New Jersey, for example, pay almost twice the state-local tax rate as those in Alaska, the state with the lowest burden.

See how your state ranks.


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