While much attention has been paid to Republican-backed tax cuts for the wealthiest, a new report reveals that even local levies take a greater share of income from the poor than the rich.
Instead of looking at the federal tax system, it examines an aspect of this problem often overlooked, state and local taxes. The report is titled, Who Pays: A Distributional Analysis of the Tax System in All 50 States. It makes the argument that the burden of local taxes falls disproportionately on the shoulders of the people who can least afford it. This detailed analysis drills down into the tax code of all 50 states and it provides evidence that local levies like sales tax are so regressive that the lowest earners pay 50 percent more of their income than the wealthiest. The bottom line is that local taxation plays a big role in aggravating income inequality, an intriguing conclusion for an issue that often focuses on the recent Republican tax bill and its generosity to the richest one percent.
So to help me break down the findings and understand how much local taxes are adding to income inequality, I’m joined by one of the people who worked on it, Dylan Grundman. Dylan is a Senior Policy Analyst at the Institute on Taxation and Economic Policy, a nonpartisan think tank which scrutinizes the nation’s tax structure. Dylan, thank you so much for joining.
Read more starting at ‘DYLAN GRUNDMAN: Absolutely, thank you for having me.’ at….
Even for Local Taxes, the Rich Pay Far less Than the Poor