State tax collections grew faster than income in 43 of the 50 states from 1981 to 1991. Per capita income nationwide increased at an average rate of 5.6 percent over the decade while state tax revenues increased per capita at an average rate of 6.6 percent.

The only states to hold tax increases below income growth were Alaska, New Mexico, Alabama, Pennsylvania, South Dakota, New Hampshire and Mississippi. Alaska was a special case because its taxes, derived mainly from oil production, were unusually high in 1981. Among states where taxes grew faster than income:

• Nevada had the largest disparity, with taxes increasing at an average annual rate of 8.0 percent per capita while income was up 4.7 percent.

• Other states with large disparities were Washington, Ohio, Missouri and Nebraska.

• The figures are for state taxes only and do not include local taxes.

Source: Tax Features, Vol. 36, No. 10, November 1992, Tax Foundation, 1250 H Street, NW, Suite 750, Washington, DC, (202) 783-2760.

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