Thursday, April 16, 2009

Taxing Logic

Posted By on Thu, Apr 16, 2009 at 3:17 PM

Last week, The Skinny made the point that increasing income taxes on people earning more than $250,000 a year would be a more progressive alternative to instituting a statewide sales-tax increase (although we should point out that such an income-tax hike would raise considerably less money.)

Now the Arizona Republic has done an analysis that shows that Arizona's income-tax burden is pretty low, compared to most states:


But, for Arizonans, there is some comfort to take on April 15, the deadline for filing income-tax returns: Among the 41 states and the District of Columbia that assess individual income taxes, Arizona charges less than all but a handful.

The Arizona Republic used income-tax rates collected by the non-profit Tax Foundation to see how Arizona stacked up with other states at three taxable-income levels: $50,000, $150,000 and $1 million. At each level, Arizona had lower tax bills than all but three to six states.

It's been that way for a long time. I wrote about it way back in April 2000. Since then, income taxes have gotten even lower, which has mostly benefited the wealthiest Arizonans.

One of the reasons that people can get away with distorting tax facts—like, for example, stirring up a big protest even though most people's income taxes have been cut under the current Democratic Congress—is that the system is so complicated that the majority of people just don't understand that they actually have a pretty good deal going, at least when it comes to income taxes.

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