What's the Matter with Washington State?

[HiPointDem]

66. no idea what is meant by "an average income tax that is negative".

Last edited Sun Oct 14, 2012, 04:24 PM - Edit history (1)

also, i don't consider, e.g., an income tax that has 4 brackets, the highest of which starts at $17K and taxes all income over that at the same rate, to be 'progressive,' for all that it may tax income under $3000 at 2% and income over $17K at 6%. it's basically a flat tax, & virginia isn't the only state that designs its income tax like that.

How Virginia State income tax rates are structured

If your income range is between $0 and $3,000, your tax rate on every dollar of income earned is 2%.

If your income range is between $3,001 and $5,000, your tax rate on every dollar of income earned is 3%.

If your income range is between $5,001 and $17,000, your tax rate on every dollar of income earned is 5%.

If your income range is $17,001 and over, your tax rate on every dollar of income earned is 5.75%.

http://swz.salary.com/salarywizard/layouthtmls/swzl_statetaxrate_va.html


state income taxes for the most part are designed to take a slice of workers' income right off the top while letting the upper classes off easy -- considering 1) the top rate is generally insignificant and 2) most state systems tax in reflection of the federal income tax payment, which has already exempted large chunks of upper-class income from taxation.

washington legislature put in an eitc for sales tax in 2008 but has yet to fund it. if the interest is progressivity, that would be a better option than subjecting workers to yet *another* tax, and a tax that wouldn't be avoidable, to boot.

Here's a listing of each state's highest income tax rate and how much income you'll have to make to pay that rate. Non-progressive states highlighted (and by non-progressive, i mean states that make no distinction between middle-class income around the median/under $100K and upper-class income).

Alabama: 5% on income over $3,000
1. Arizona: 4.54% on income over $150,000
Arkansas: 7% on income over $32,600
2. California:10.55% on income over $1 million
Colorado: flat 4.63% of federal taxable income
3. Connecticut: 6.5% on income over $500,000
District of Columbia: 8.5% on income over $40,000
Delaware: 6.95% on income over $60,000

Georgia: 6% on income over $7,000
4. Hawaii: 11% on income over $200,000
Idaho: 7.8% on income over $26,418
Illinois: flat 3% of federal AGI with modifications
Indiana: flat 3.4% of federal AGI with modifications
Iowa: 8.98% on income over $63,315
Kansas: 6.45% on income over $30,000
Kentucky: 6% on income over $75,000
Louisiana: 6% on income over $50,000
Maine: 8.5% on income over $20,150
5. Maryland: 6.25% on income over $1 millio
Massachusetts: flat 5.3% on all income
Michigan: flat 4.35% of federal AGI with modifications
Minnesota: 7.85% on income over $74,780
Mississippi: 5% on income over $10,000
Missouri: 6% on income over $9,000
Montana: 6.9% on income over $15,400
Nebraska: 6.84% on income over $27,000

6. New Hampshire: 5% on interest and dividend income. Wages are not taxed.
7. New Jersey: 8.97% on income over $500,000
New Mexico: 4.9% on income over $16,000
8. New York: 8.97% on income over $500,000
North Carolina: 7.75% on income over $60,000
9. North Dakota: 4.86% on income over $373,650
10. Ohio: 5.925% on income over $200,000
Oklahoma: 5.5% on income over $8,700
11. Oregon: 11% on income over $250,000
Pennsylvania: flat 3.07% on all income
12. Rhode Island: 9.9% on income over $373,650
South Carolina: 7% on income over $13,700

13. Tennessee: 6% on interest and dividend income. Wages are not taxed.

Utah: flat 5% on all income
14. Vermont: 8.95% on income over $373,650
Virginia: 5.75% on income over $17,000

West Virginia: 6.5% on income over $60,000
15. Wisconsin: 7.75% on income over $225,000

http://taxes.about.com/od/statetaxes/a/highest-state-income-tax-rates.htm

There are only 15 states that have anything approaching a really 'progressive' income tax. And most states with income taxes combine them with sales taxes -- which is why state taxes are all regressive.