by Jon Honeck, Ph.D.
Low- and middle-income Ohioans pay a much greater share of their income
in state and local taxes than the state’s most affluent do, according
to a study released today by the Institute on Taxation and Economic
Policy (ITEP).
The study’s key finding is that nearly every state and local tax
system takes a much greater share of income from middle- and low-income
families than from the wealthy. Only two states require their best-off
citizens to pay as much of their incomes in taxes as their poorest
families must pay, and only one – California – taxes its wealthiest
individuals at a rate higher than middle-income families have to pay.
The top 1 percent of non-elderly Ohio families by income, who earned at
least $352,000 in 2007, on average pay 7.8 percent of their income in
state and local taxes. By contrast, the lowest fifth, who make less than
$17,000, on average pay 12.0 percent. Families in the middle fifth of
the income spectrum, who make between $32,000 and $50,000, on average
pay 11.0 percent.
Recent changes in Ohio’s state and local tax system have increased
the disparity. The report found that Ohio ranks 28th among states in the
fairness of its tax system, based on the share of their income affluent
Ohioans are paying in state and local taxes compared to that of lower-
and middle-income Ohioans. Last time the study was done, which covered
the law as of 2002, Ohio ranked 14th by this measure.
Read the report, Who Pays? A Distributional Analysis of the Tax Systems
in All 50 States, here: http://www.itepnet.org/whopays.htm
Tags: middle class, Northeast Ohio, Ohio, poor, taxes