The Tax Foundation recently conducted a 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 York finished 2nd last (49) in overall tax climate and it ranked in the individual tax categories as follows: 7 (corporate tax), 49 (individual income tax), 43 (sales tax), 32 (unemployment insurance tax), and 47 (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. With a state sales tax rate of 4.00%, New York is ranked 38th.
New York (4.49 percent), along with Louisiana (5.01 percent), Alabama (4.93 percent), Colorado (4.54 percent), and Oklahoma (4.28 percent) are the five states with the highest average local sales tax rates. New York’s combined rate of 8.49% ranks 9th in the country.
New York collects $1,310 in state and local general sales tax per capita, which is tenth nationally. It collects a state gasoline tax of 42.64 cents per gallon, which is third highest in the country while its cigarette tax of $4.35 is the highest in the United States. It’s expensive to smoke in the state of New York!
Property Tax
New York finished 47th in the property tax climate rankings. New York has an effective property tax rate of 1.38%, which ranks 14th nationally. In state and local property tax collected per capita, New York ranked 4th in the country with $2,494.
It is wise for taxpayers, whether an individual or business located in the New York or Tri-State area, 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.
