The Tax Foundation recently conducted a study of the tax climates in each of the fifty states and then rated and ranked them based on five categories: corporate tax, individual income, sales tax, unemployment insurance tax, and property tax. The Tax Foundation’s rankings are designed to show how well state tax systems are structured, rather than simply rank the states by the amount of taxes assessed.
New Jersey finished dead last in overall tax climate and it ranked in the individual tax categories as follows: 42 (corporate tax), 48 (individual income tax), 45 (sales tax), 25 (unemployment insurance tax), and 50 (property tax).
Sales Tax
Forty-five states and the District of Columbia collect statewide sales taxes. Residents of 38 states are also subject to sales taxes at the local level. In the rankings for local sales tax, New Jersey’s average local score is represented as a negative, -0.03%. New Jersey’s combined rate of 6.97% ranks 24th in the country.
New Jersey collects $949 in state and local general sales tax per capita, which is 24th nationally. It collects a state gasoline tax of 37.50 cents per gallon while its cigarette tax of $2.70 ranks 9th in the United States.
Property Tax
New Jersey finished dead last in the property tax climate rankings. It has an effective property tax rate of 2.11%, which ranks 1st nationally. In state and local property tax collected per capita, New Jersey is also ranked 1st in the country with $2,989.
It is wise for both individual and business taxpayers located in New Jersey to consult with a tax professional to help assess their current tax situation, looking ahead to the future. If you have any question about taxes, especially in planning ahead for the next filing season, call THE TAX EXPERTS at the Thorgood Law Firm www.thorgoodlaw.com. For a FREE consultation call 212-490-0704.
