NCPA - National Center for Policy Analysis


December 27, 2004

Although so-called blue states are wealthier than the red states, they voted for Sen. John Kerry (D-Mass) and his proposals for increased taxes on the wealthy, says Marc Sumerlin of the Lindsey Group.

Currently, the top 1 percent of taxpayers pays 37 percent of the federal income tax while the bottom 50 percent pays just 6 percent. Therefore, since blue states have higher average incomes and more wealthy people, they carry a disproportionate share of the federal tax burden.

To illustrate, Sumerlin compares the roughly equally populous blue state of Connecticut and the red state of Oklahoma:

  • In 2003, Connecticut tax filers paid $19.1 billion in personal taxes on $107 billion of adjusted gross income which makes for an average tax rate of 17.9 percent.
  • In the same year, Oklahoma tax filers paid $6.6 billion in personal income taxes on $54 billion of adjusted gross income; an average tax rate of 12.2 percent.

Ironically, Kerry's proposed tax hike on high-income earners would have raised taxes for four times as many residents in Connecticut as in Oklahoma. Furthermore, the tax burden is even worse in light of the general difference in the cost of living between blue and red states:

  • For example, earning $130,000 a year in Connecticut is equivalent to earning $90,000 in Oklahoma.
  • These families are equally well-off, but a Connecticut family of four making $130,000 pays 15.7 percent of their income in taxes, while the Oklahoma family of four making $90,000 pays only 9.4 percent.

Thus, observes one Democratic strategist: "the segment of the country that pays for the federal government is now being governed by the people who don't pay for the federal government.?

Source: Marc Sumerlin, "The Blue-State Tax Burden," Wall Street Journal, December 13, 2004.

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