By David Lightman
Calif. Gov. Newsom says his state is “well worth the price” compared to Fla., but an analysis finds Fla. at No. 45 for overall tax burden while Calif. is No. 9.
SACRAMENTO, Calif. – How do California’s taxes rank compared to other states like Florida or Texas? Californians do have a bigger tax burden than rival states Texas and Florida.
WalletHub, a financial services firm, estimated that the annual state and local taxes for a median California household cost $9,612. In Texas, the bill is $8,006, and in Florida, $5,355. Californians’ tax rates overall are lower than the national average. However, high incomes and property values drive up the taxes.
Gov. Gavin Newsom likes to compare the cost of living in California, Texas and Florida, arguing his state is well worth the price.
WalletHub found that a Californian’s tax burden ranks ninth highest in the country, well above Texas’ 32nd ranking and Florida’s 45th. Tax burden is the property, individual income and sales and excise tax as a share of personal income.
The more income, the lower the tax rate, said the Institute on Taxation and Economic Policy, a progressive economic group. It said that the top 1% of income earners in Texas paid an average of 3.1% in state and local taxes as a share of income. The top 1% in California paid 12.4%.
The ultra-wealthy could be getting hit even harder. President Joe Biden last week proposed a series of higher taxes on those with incomes of more than $400,000. He would increase the Medicare tax rate from 3.8% to 5% on incomes above that level, and would impose a 25% minimum tax rate on wealth over $100 million. Biden’s budget maintains that the wealthy benefit from “sophisticated tax planning and giant loopholes” that often allows them to pay income tax at rates lower than middle and lower class earners.
