We now have the first study on total state and local tax burdens done since Illinois raised its income tax rate last year. Illinois has the highest burden — 51st among other states and DC. That’s no surprise since rankings done before the tax hike already had Illinois at or near the highest tax burden.
Illinoisans pay a staggering 38% more in state and local taxes than the average American with median national household income, according to the study. And that’s the right metric to look at in the study: total taxes in different states on a given amount of income.
The full report by WalletHub is linked here. Some have questioned their conclusions in the past but this new report lays out their methodology and it’s pretty straightforward. For Illinois, while income taxes are still middling, the primary drag is high property tax rates. The study has easy to use tools to sort by different elements of total tax burden.
If this doesn’t expose the utter madness of raising taxes further, which is the central theme of Illinois Democrats, nothing will.
Another interesting lesson from the study is what it says about the Minnesota Myth. That’s the notion peddled by many Illinois Progressives that we just need to be more like Minnesota — raise taxes to match theirs to provide comparable services. They dishonestly focus on income tax rates only. In fact, Minnesota is a low tax state by comparison to Illinois. It’s ranked 31 on total state and local burden.
Either Illinois regains a competitive tax burden with competitive services or it’s doomed.
–Mark Glennon is founder and Executive Editor of Wirepoints. Opinions expressed are his own.