Monday, April 25, 2011

Monday Map: State Income Tax Rates

Following last Monday's state sales tax map, here's the Tax Foundation's state income tax rate map for 2011 (click to enlarge). 


At 4/25/2011 10:38 PM, Blogger Benjamin Cole said...

The higher the income tax, the better the food?

At 4/26/2011 7:59 AM, Blogger Jason said...

This comment has been removed by the author.

At 4/26/2011 8:51 AM, Blogger morganovich said...

that number is not correct for California.

for 2011 the top CA income tax rate is 11%. (up from 10.7% i believe)

At 4/26/2011 8:53 AM, Blogger morganovich said...

btw - it would be interesting to find a way to combine state income tax with state sales tax to create a sort of "tax misery index".

you could then compare that to migration tares, unemployment rates, growth, etc.

that would make for some interesting reading. i would bet that there would be strong linearity in scatterplots of those variables.

At 4/26/2011 9:11 AM, Blogger Michael Hoff said...

How is California still a going concern?

Has anyone ever determined the value of weather? Obviously, good weather is worth a fortune, since California can tax the living hell out people and they stay because it's sunny.

At 4/26/2011 9:13 AM, Blogger Michael Hoff said...


I have to challenge you to a duel now. You've assaulted the honor of Pennsylvania's pierogies and funnel cakes.

At 4/26/2011 9:49 AM, Blogger morganovich said...


and cheese-steaks dammit!

there also seems to be some counter evidence:

indiana and new jersey both have high taxes and bad food...

the food in new york is also not terribly good once you get out of NYC.

At 4/26/2011 10:53 AM, Blogger Benjamin Cole said...

Michael Hoff-

Wel, I do like funnel cakes. And they have hot-crossed buns upstate NY I think.

At 4/26/2011 1:19 PM, Blogger Mike said...

First, Morganovich, I love that idea, but like we talked about last week - those sales tax figures aren't even close to what people really are paying since they don't have any county sales taxes added in.

Secondly, and much more important, Texas has amazing food! Outside of the bbq, Cajun and REAL Mexican food, we have several non-chain places that I'd put up against anything in NYC at a fraction of the price (3 of my favorite places have wines lists that are retail+$ can grab a Cakebread chardonnay for $40.) You can have a truly fantastic dinner for two and a nice bottle of wine for around $100.

At 4/26/2011 1:41 PM, Blogger Alan said...

Maps like this are misleading because they omit local taxes. Yes, Indiana has a 3.4% income tax rate (on adjusted gross income, with no important deductions and no break for capital gains). But my county adds a couple of percentage points to that.

At 4/26/2011 1:49 PM, Blogger Jet Beagle said...

morganovich: " it would be interesting to find a way to combine state income tax with state sales tax to create a sort of 'tax misery index'."

The Tax Foundation has derived the overall tax burden for each state This is not the marginal burden, but rather the average burden. They simply sum all the state and local tax receipts for the state, and then divide by the state's total income. Here's how the largest states stack up:

State burden ... rank

CA ........ 10.6% ..... 6
NY ........ 12.1% ..... 2
TX ........ 7.9% ..... 45
FL ........ 9.2% ..... 31
IL ........ 10.0% ..... 13
PA ....... 10.1% ..... 10
NJ ........ 12.2% ..... 1
MI ........ 9.7% ..... 21

U.S. ...... 9.8%

At 4/26/2011 1:53 PM, Blogger Prof J said...

What is also needed here is the state corporate income tax.

At 4/26/2011 2:15 PM, Blogger morganovich said...


i have spent a fair bit of time in texas. i used to be in dallas or austin 4-5 times a year and have been wined and dined at their best. i'm gonna have to respectfully disagree on the food (other than BBQ and perhaps the mexican).

i lived in the bay area for 15 years and there's just no contest. a good neighborhood place in SF would beat anything in dallas. (especially on wine. cakebread is safeway fare and overpriced to boot)

there is nothing in texas that could run with boulevard, gary danko, per se, or nobu, much less french laundry.

dallas has nearly 3X the population is SF, and doesn't have 10% of the food. even the super high end like french room are pretty mediocre. (and certainly not cheap)

providence has better food than dallas and houston does not even bear discussion...

i realize this is all incredibly subjective, but i'm not sure there is better eating anywhere in the world than the bay area and i say this as someone who has spent a lot of time in france and italy. many seem to argue for NYC, but that's really an intractable chocolate/vanilla thing. if you like heavy saucing, butter, and cream, NYC is the place. if you like fresh, ingredient forward stuff, it's the bay area.

i do not miss the politics (or the taxes), but i will always miss the food.

At 4/26/2011 2:18 PM, Blogger morganovich said...


thanks for that. what makes average burden a little different is that de-emphasizes the high end. it is the high tax brackets that drive most business growth through investment etc (and corporate taxes).

i suspect that a state with 1% tax for the bottom 90% and 20% tax for the top 10% would experience a very different overall economic impact than one that had just 5% across the board.

At 4/26/2011 2:36 PM, Blogger Jet Beagle said...


I agree that knowing the marginal burden of government would be useful. But I cannot imagine any way one could derive it. One would have to assume that the property tax burden is highly correlated with the income tax burden and with the sales tax burden. I'm not at all confident that is true at the high end.

The average tax rate is, IMO, a really nice number for comparing the direct burden of government across the states. It does not, however, measure the indirect burden of government: the extent to which regulation and various laws inhibit economic growth.

At 4/26/2011 3:16 PM, Blogger Benjamin Cole said...


$100 for dinner for two?

You can have terrific food in L.A.--much better than the bland, greasy Texas crap--easily under for $40 for two in LA maybe $50 with wine and coffee.

And we have food from Thailand, Peru, Mexico, El Salvador, China, Chinese provinces, Japan, Germany, France, Italy , bla, bla, bla, bla.

Cheesecake--you don't know cheesecake. Pastrami? You don't know pastrami.

As for BBQ, I cook over oak, and ain't nobody better than me.

I lived in Texas, and I really liked the people, very friendly. But the food? Please.

Free iced-tea refills was nice.

What was that main dish? Chicken-fried steak?

At 4/26/2011 4:08 PM, Blogger morganovich said...


true, but many states have progressive tax rates (like california). this makes the average income tax rate less relevant to business than the top which is twice as high.

there are lots of other factors that drive economic performance besides taxes. (like regulations, utility costs, etc.)

my purpose was never to explain everyhting, just to see if the scatterplot showed the sort of linearity you'd see in a causal relationship.

it's much easier to do with tax rates than regulations. i'm not even sure how you could measure that objectively.

At 4/26/2011 4:27 PM, Blogger Jet Beagle said...

Benjamin: "You can have terrific food in L.A.--much better than the bland, greasy Texas crap--"

Both California and Texas have bland and greasy food. Both states also have a great diversity of ethnic restaurants. It's very simple to find the latter in Dallas and Houston.

If you don't like the BBQ and country cooking that most Texans prefer, just eat somewhere else. And STFU.

At 4/26/2011 4:30 PM, Blogger morganovich said...


"You can have terrific food in L.A.--much better than the bland, greasy Texas crap--easily under for $40 for two in LA maybe $50 with wine and coffee."

we're not talking about olive garden and two buck chuck here benji.

if you are having dinners where a bottle of wine and coffee cost $10, then you are drinking some real trash.

LA does have some good food (ivy, etc) but it is certainly not cheap.

i think you have a much lower bar for "good food and wine" that what we were contemplating.

At 4/26/2011 5:10 PM, Blogger Benjamin Cole said...

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At 4/26/2011 5:10 PM, Blogger Benjamin Cole said...

Morgan Frank-

You don't have to eat in Beverly Hills to dine well in SoCal.

Ever heard of Langner's, best pastrami in the nation? Canter's, the best Hungarian cheescake anywhere?

Thai/Chinese/Korean restaurants are everywhere. Two-three $10 entres, and you're good.

You will never eat well in Utah. Ha-ha, do you like oatmeal? They have great, instant oatmeal in Utah. Add in a little refined sugar and frozen strawberries, and you are in Utah heaven.

Texas--they just can't do it. They invented the chicken-fried steak, and never looked back--or forward.

They did have a wonderful beer garden in Austin years back. Not that the beer was special, but the atmosphere was good. Except on hot muggy nights, which pretty much defines most of the year in Austin.

Okay, you have lower taxes in Utah and TX, and your people are friendlier. But your food is inferior. And your haberdasheries.

At 4/26/2011 6:13 PM, Blogger Mike said...

You're right, it's subjective, but I do eat at fine places all across the country (and world when I can) and I think you're wrong about Houston.
I do LOVE Gary Danko, but I was really thinking of less-formal fine(r)-dining.
Houston only really has one place that I'd compare with G.D. (Mark's...maybe Cafe Annie)....Dallas is chain central and mostly not worth half the price they charge. Oh (and while I do love their cab) I only used the Cakebread example as something decent that most people can get and would know. I'm not saying it's the best, just saying $40 at a restaurant is about half the normal price. Houston is a very casual city and it seems that most people would like to wear jeans and eat somewhere in the 'very good' range on the way to the bars...that's more my style, so I'm not complaining.

And, Benjamin, actually...I do know.
Judging by your comments, my guess is that I've eaten in more CA places than you have Texas. You broad-brush all Texas food as "greasy" but you set the bar at pastrami? I'll admit, I just may not understand you. If you're basing Texas food on Austin, then I can understand your position. Lived there for years and couldn't wait to go ANYWHERE else for dinner....but it's a very small town and a college/hippy-fest-meets-country-bumpkin small town at that. Unfortunately, the tech guys were just starting to make an impact on the city when I was about to move...although I did think Hudson's On The Bend was a cool place for dinner...very different and very good.

At 4/26/2011 6:43 PM, Blogger juandos said...

Yet another pseudo bennyism long on silly and short on reality: "You can have terrific food in L.A.--much better than the bland, greasy Texas crap--easily under for $40 for two in LA maybe $50 with wine and coffee"...

From Frisco south to the Mexican border California is nothing but one sleazy, over priced 'swill-a-thon'...

At 4/26/2011 6:57 PM, Blogger Mike said...

Just mentioning Hudson's On The Bend made me check their menu. They have an espresso-chocolate-chili rubbed, smoked elk back-strap with jumbo lump blue crab as an entree.
If that sounds bland to you, Benjamin, I have found the problem.
(Their '04 Far Niente cab is $375 though...I'll stay in Houston)

At 4/26/2011 7:18 PM, Blogger Benjamin Cole said...


Truth to tell, I have not eaten in Texas since 1979. Oh, maybe a few times in the 1990s, when I was doing trade shows in Dallas.

My real point is that Los Angeles has incredibly good food for nearly McDonald's prices, because immigrants come in here and start up restaurants.

As I often sy, I wish they allowed food-cart vendors, because I have eaten some great food in Thailand that way.

I hereby officially withdraw my comments on Texas as the outdated views of an old fogey.

It was Shultlz' Beer Garden in Austin that I remember (through a an amber haze).

I once chased a fat girl there, and still struck out.

At 4/26/2011 10:08 PM, Blogger SBVOR said...

The states which charge no income tax tend to make it up with exorbitant property taxes, sales taxes, etc.

They all get you one way or another -- some worse than others. There's more to it than just income tax. Each individual has to determine how one state compares to another relative to their own situation.

At 4/27/2011 6:01 AM, Blogger Jet Beagle said...

SBVOR: "The states which charge no income tax tend to make it up with exorbitant property taxes, sales taxes, etc"

Some do have higher property tax rates. But that does not "make it up" completely. As I showed in my earlier comment, TX has one of the lowest tax burdens of all the states, at about 65% the overall tax burden of NY and NJ. TN and SD have even lower overall tax burdens.

At 4/27/2011 9:16 AM, Blogger SBVOR said...


Here's a challenge:

Look at a retired person with an annual income of $30,000 per year and owning (outright) a home valued at $400,000. Tell me whether that person will have a lower tax burden in Colorado or in Texas. The answer might surprise you.

I think you will find the Texas tax code encourages people to work and the Colorado tax code encourages people to retire. Which tax code encourages a stronger economy? Which tax code delivers a higher Medicare burden? Why would anybody retire in Texas?

At 4/27/2011 9:18 AM, Blogger morganovich said...


i'm not saying that there is no good food in LA, just that it's very limited and that you are talking about diner/deli quality food and i am talking about actual dining quality dining. one place with decent pastrami doth not a culinary mecca make. and LA has about the worst wine lists in california apart from san diego. you'll drink better in sacramento.

(that said, the wine selection in UT is far from awesome, but i didn't move here for the food)

there is not a place in LA that can run with shabu in park city (chefs from nobu in nyc). there is little in LA even comparable to chimayo or spruce or talisker, especially as what is is overgalmmed celebrity chef pretension as opposed to comfy neighborhood type places. people from LA look forward to skiing here because the food is better and you can lose the attitude. ask the sundance crowd.

sorry kid, but you are just talking bollocks. i doubt you have ever even eaten here. there is surprisingly good food in salt lake as well. it's over 50% non mormon now mostly made up of california tech transplants. (that why it wins best city for business every year). the food is certainly not like SF and lacks the great neighborhood places, but it's not anything like what you are describing, especially as a guy from LA most of whose food is pretty weak apart from the high end and all of which is a 30 minute drive from anywhere.

park city is a town of 30,000. you will not find better food in a town this size outside of napa valley. that said, it's VERY expensive. but you are never going to see a small town compete with a top culinary city. that's just not how it works.

you have even admitted that you have no idea what you are talking about. that was an awful lot of smack to talk about texas for someone who hasn't been there in 20-30 years. of course, hearing you opine vitriolically on a topic you have no data about is hardly surprising...

At 4/27/2011 10:40 AM, Blogger Jet Beagle said...

SBVOR: "Why would anybody retire in Texas?"

I have known very few people who choose a retirement location based solely on levels of taxation. Millions of people have retired in Texas because:

- the total cost of living is very low;
- they like the warm climate;
- they enjoy the Texas culture (not for everyone, but many of us appreciate it);
- they desire to be close to family.

I really do not understand what point you are making.

At 4/27/2011 10:43 AM, Blogger Jet Beagle said...


Texas has one of the lowest total tax burdens in the nation. Of course that doesn't mean it is the best tax situation for every single person.

Your initial argument was that states with no income taxes make up for it with other higher taxes. The research by The Tax Foundation says otherwise. You have now changed your argument, so my initial response does not apply.

At 4/27/2011 11:44 AM, Blogger SBVOR said...

Jet Beagle affirms the last sentence in my original comment when he says:

"Of course that doesn't mean it is the best tax situation for every single person."

Apology accepted (in advance).

At 4/27/2011 12:42 PM, Blogger Jet Beagle said...


No apology is forthcoming. It was not the last sentence of your first comment to which I objected. It was the first sentence:

"The states which charge no income tax tend to make it up with exorbitant property taxes, sales taxes, etc."

Again, the Tax Foundation has researched the issue and determined that TX, SD, and TN - none of which have state income taxes - do not "make it up with exorbitant property taxes, sales taxes, etc.".

At 4/27/2011 1:13 PM, Blogger SBVOR said...

Jet Beagle,

Research the property tax rates in Colorado vs. Texas and get back to me with that much needed apology.

At 4/27/2011 1:20 PM, Blogger SBVOR said...

Jet Beagle,

I’ll save you the trouble…

Click here for retiree tax heavens.

Colorado qualifies, Texas does not.

Now, about that apology.

At 4/27/2011 2:03 PM, Blogger SBVOR said...

This comment has been removed by the author.

At 4/27/2011 2:27 PM, Blogger SBVOR said...

This comment has been removed by the author.

At 4/27/2011 2:37 PM, Blogger SBVOR said...

Jet Beagle,

Click here and examine property tax rates by state.

At 4/27/2011 2:40 PM, Blogger Jet Beagle said...


You seem to have trouble comprehending what I disagreed with, so I'll not bother with further explanation. I am confident that no one else cares about our "disagreement". Please continue the "argument" as long as you wish.

At 4/27/2011 2:54 PM, Blogger SBVOR said...

Jet Beagle,

Once again, we see the proof of the age old adage...

Those who have the facts on their side argue the facts.

Those who do not have the facts on their side attack the messenger.

At 4/27/2011 4:54 PM, Blogger Jet Beagle said...


I am sorry that you felt my response was an attack. It wasn't intended to be. I should have been more careful in my choice of words.

At 4/27/2011 5:53 PM, Blogger SBVOR said...

Jet Beagle,

Apology accepted. In many cases TX offers the lower tax burden. In many other cases CO offers the lower tax burden. It all depends on personal circumstance. For most retired persons, property tax rates are the more important consideration. In many cases (driven by local tax rates) TX property tax rates are 6 times higher than CO.


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