At least 27 U.S. states are reducing the percentages to be paid in taxes on income earned by taxpayers. At Globe Live Media we tell you who they are.
When we go to file our tax return we think that the worst part is when the tax bill comes out high, since the adjustments we made in the checks each month, for this concept, would not have been enough. The nightmare is compounded if, after paying the federal taxes, we still have to pay the state taxes. The good news is that currently, at least 50% of U.S. states are reducing or even eliminating the percentage that is left to be paid.
Currently, 27 states across the United States have entered into this dynamic. According to a study by the National Association of State Budget Officers, as of two years ago, some state governments have surpassed widespread budget surpluses amid “recent state policy actions to strengthen their reserves,” which includes billions of dollars that were granted by the federal government as financial assistance for the Covid-19 pandemic.
If we want to put it in numbers, the reserves totaled $70 billion by 2020, and are projected to reach $136 billion by 2023, if not double that amount.
It is for this reason that many states across the country, confident in their budgets, are reducing tax collections and in turn are considering offering property tax cuts and rebate checks or stimulus checks in order to reduce the amount of income taxes their residents must pay. In some cases, they are even going so far as to eliminate income taxes altogether, as is the case in Arkansas and Mississippi.
According to a CBS News investigation, some of the reasons behind these decisions are that with these actions they can make their states more competitive, to boost economic growth and even for the inhabitants of their areas to combat the high inflation that has been plaguing them for more than a year.
So, to give you an idea of whether the state you live in has lowered the amount of taxes that taxpayers must pay on their income, or has eliminated them completely, take note of the following list:
1.- Arkansas: Completely eliminated income tax.
2.- Colorado: Will grant $200 million dollars as part of an economic relief on property taxes.
3. Connecticut: It is reducing the percentage that people must pay in taxes and everything will depend on each situation.
4. Georgia: Will send a total amount of $1 billion in stimulus checks for its residents to combat fierce inflation. It will also use another $1 billion in economic property tax relief.
5. Idaho: $120 million in property tax relief.
6. Indiana: Reduction of the percentage due on individual taxes, as well as property tax cuts.
7. Iowa: Its 3.9% tax rate and property tax rate is one of the lowest in the United States.
8. Kansas: It has lowered the percentage of income and Social Security taxes payable.
9.- Kentucky: Will decrease income tax from 5% to 4%.
10.- Louisiana: On the way to eliminate income taxes.
11. Michigan: $180 tax refund for all state filers, eliminating a retirement tax, extending its equalization of the federal earned income tax credit.
12. Minnesota: Fully eliminated Social Security taxes.
13. Mississippi: Completely eliminated statewide income taxes.
14.- Missouri: Will reduce income, sales and property taxes.
15.- Montana: Will send $1,250 or more in tax rebate checks for residents and $500 stimulus checks for homeowners.
16.- Nebraska: Will reduce income tax rates and eliminate all Social Security income from taxation.
17. New Mexico: Will send stimulus checks, such as tax refunds, worth up to $750 for residents.
18. North Carolina: Will implement a reduction in the individual income tax rate.
19. North Dakota: Will completely eliminate the individual income tax for low- and middle-income individuals.
20.- Ohio: Will implement a flat income tax.
21.- Oklahoma: Will reduce state grocery taxes and individual income tax rates.
22.- South Carolina: Will make changes to tax brackets.
23.- Utah: Will send stimulus checks of up to $100 or more to residents. Will also implement an income tax rate reduction.
24. Vermont: Will not tax veterans’ pensions and there will be more tax exemptions for Social Security.
25.- Virginia: Will reduce tax rates for individual taxpayers.
26.- West Virginia: Will reduce by half the tax rate for individual taxpayers during the next three years.
27. Wisconsin: Will reduce taxes for middle class taxpayers.