Saturday, November 28, 2009

Study Says PA's Tax Rate is Regressive

A new study says Pennsylvania's tax rate is one of the "most regressive" in the nation.
Sharon Ward of the Pennsylvania Budget and Policy Center, a liberal think tank, says that's because every commonwealth resident pays the same 3.07 percent personal income tax, no matter how much money he or she is bringing in.
Ward says that means lower earners end up paying out a much higher portion of their finances into income, sales and property taxes.
She wants lawmakers to consider charging a higher income tax rate to the wealthy, so that lower and middle-income taxpayers can catch a break. Ward says that's feasible.

"It's important to note that we're--our tax rate is much lower than the surrounding states. Our top income tax rate is much lower than New York, New Jersey, Delaware, even West Virginia. Very high income earners--people over 500,000 dollars--pay twice as much income taxes in West Virginia."

According to the data, families earning 19-thousand dollars or less are spending 11 percent of their income on taxes, compared to the 5 percent that families earning more than 1.3 million dollars are shelling out.

The national study was put together by the Institute on Taxation and Economic Policy.

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