Ryan Ray
A new report released Monday by online financial services firm WalletHub says Florida ranks near the bottom nationally when it comes to the fairness of its state and local taxes.
The survey evaluated the taxes levied by all 50 states – broken down by income, property, sales & excise and “other” taxes – and how they are levied on people of various income brackets. Then it compared that to the ideal system of taxation, gathered by asking respondents, “In thinking about the fairest possible tax system, what percentage of income do you think households at each income level should pay in state and local taxes?”
The analysis showed Florida’s tax regime to be considerably less fair than average among states, ranking Florida No. 45 out of 50.
Florida made both the top 10 for states where the very wealthiest are under-taxed compared with respondents’ ideal rates and the top 10 states where the working-class and poor people are taxed too heavily, as illustrated below.
The state gained bad marks for its high sales and excise taxes, which are generally deemed regressive by taxation experts.
Florida was 44th most reliant on such taxes for state revenue, plus 43rd most reliant on property taxes. The latter is shaping up ongoing issue in the state education budget, with multiple senators with education administration backgrounds vowing to stop any proposal that leans too heavily on local funding from property taxes.
The survey indicated the Sunshine State soaks its homeowners more than all but six other states.
Its No. 45 ranking puts the state at slightly more fair than the states of Illinois, Arkansas and neighboring Georgia, which came in at No. 49, and slightly less fair than Indiana, Texas and Mississippi.
Montana took top honors overall according to the report, being docked only for relatively high sales taxes in the state. Oregon, South Carolina, Delaware and Idaho rounded out the top five, though their paths to the top diverged significantly.
Delaware and Oregon, for instance, have low or no state income tax whereas Montana and South Carolina’s fairness rating was buoyed by low property taxes.
Florida is one of seven states with no state income tax.
The nonscientific survey used results from an online poll of 1,050 U.S. residents.
