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In an article published by CNBC on Monday, the founder of Citadel hedge fund, Ken Griffin, made the prediction that “Northern states that predominantly support the Democratic Party will be negatively impacted by President Donald Trump’s tax plan.”
Griffin believes that by putting a cap on deductions for property, state and local income taxes ($10,000) it will hurt people in states that have higher property taxes and home values. He believes that those states will either have to lower taxes, which would reduce state income, or people would relocate and leave those states. The vast majority of those states with the highest percentages of property taxes, as well as high state and local income taxes, are in the northern part of the United States and are predominantly Democratic voting states.
Griffin is quoted in the article saying, “In the next five to 10 years we’ve got to deal with the pressures on the blue states to be competitive with the Southern states to maintain strong workforces, strong employment bases in the northern half of our country.”
The Tax Foundation looked at data from Fiscal Year 2015, the most recent data available, to see how states compared when it comes to property taxes. Washington D.C. does not count but if it did, it would rank number one on the list ($3,350). Therefore, New Jersey is number one ($3,074) followed by New Hampshire ($3,054), Connecticut ($2,847), New York ($2,697) and Vermont ($2,542).
Kansas comes in at number 22 on that list with $1,440 while Missouri landed at number 35 with $990. According to the article from the Tax Foundation, “On average, state and local governments collect $1,518 per capita in property taxes, but collections vary widely by state, and several regional trends exist.”
Source: TaxFoundation.org
For state and local individual income taxes, the Tax Foundation once again used data from Fiscal Year 2015. Five states (Florida, Texas, Washington, South Dakota, Wyoming and Nevada) do not have a state income tax. Tennessee and New Hampshire do not tax wage income, but do tax interest and dividend income.
This map once again shows that northern states have higher taxes than most. New York ranks number one at $2,789, followed by Connecticut ($2,279), Maryland ($2,200), Massachusetts ($2,133), and California ($1,991). Once again, Washington D.C. would be in the number two spot if it was considered a state, with a per capita tax of $2,780.
Missouri and Kansas flip-flopped on this tax map with Missouri’s per capita coming in at $1,025, placing them at number 27. Kansas’ per capita clocking in at $778 and a number 34 ranking.
“On average, state and local governments collected $1,144 per person from individual income taxes, but collections varied widely from state to state,” according to the Tax Foundation’s findings.
Source: TaxFoundation.org
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