How Regresiıve Are State And Local Taxes?

Year 2013, Volume: 2 Issue: 1, 90 - 106, 01.03.2013

John P. Formby Hoseong Kim Keith D. Malone

Abstract

State and local income, sales and property taxes are combined and tax regression is measured for each state and the District of Columbia. All direct tax systems are regressive and there are large differences across states. State and local tax systems are ranked in terms of both the Reynolds-Smolensky and Kakwani indexes of global progression. The most regressive state is 75 to 88 times more regressive than the least regressive state. Inspection of the data underpinning the Gini-based indexes reveals that 49 of the 51 tax systems are unambiguously regressive at every measured point within the income and direct tax distributions.

Keywords

Welfare economics, taxation, state and local government.

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