The Impact of Tax Rates, Partisanship and Economic Variables on the Distribution of State and Local Tax Burdens

This study finds that the ratio of state and local taxes as a percentage of income for the wealthiest 1 % of non-elderly households to the poorest 20 % of non-elderly households in 2002 is significantly influenced by the value of this same ratio for 1989, whether a state has a multi-rate income tax, right-to-work laws, the liberalism of a state’s electorate and the average tax burden in a state. Democratic strength in state government, Republican control, change in median income, and change in the share of income going to the wealthiest 1 % of households are not significant predictors. The results are very similar for a top 2%-5%/bottom 20 % ratio