If you think your taxes are high…there is a new study to prove it.
Kiplinger has ranked California the “least tax friendly state.” It’s joined in the top five by Hawaii, Connecticut, New York and New Jersey. The rankings take into account the percentage that residents pay on income taxes, sales taxes, gas taxes and so-called sin taxes like alcohol and tobacco.
The Kiplinger report notes that California has a 7.5% sales tax, but several cities have an additional localized sales tax, bringing the statewide average to 8.48%. The income tax actually ranks low for married joint filers in the lower income brackets (1% for those making $15,700) but is among the highest for those making over $1-million (13.3%). Also of note there is an 11.6% tax on wireless services and 0.65% tax in the form of a vehicle license fee. There is a $0.20 per gallon tax on beer and wine and a $3.30 per gallon tax on hard liquor. Cigarettes are taxed $0.87 per pack and all other tobacco products are taxed at 28% of the wholesale price.
On the opposite spectrum, the most “tax friendly states” are Wyoming, Alaska, Florida and Nevada.
By comparison, next door Nevada has no income tax, a statewide sales tax of 5.5% ($7.98% when averaging localized taxes), and a 2% tax on wireless services. However, Nevada does have a higher cigarette tax ($1.80 per pack) and a higher tax on wine ($0.70 per gallon).