NYC IS TAX CAPITAL
February 22, 2007
Taxes take a bigger bite out of the Big Apple than any other urban area in the nation, according to an analysis by the Independent Budget Office.
According to the researchers:
- Local government taxes absorb $9.02 of every $100 of taxable resources here.
- The rate is 47 percent more than the $6.16 average for the most populous U.S. cities.
"No other large city comes close," the researchers said.
- After New York, Philadelphia rated next highest, with $7.16 per $100, and Los Angeles followed with $6.88.
- Of the nine cities, Dallas had the lowest rate, with $5.20 per $100.
To reach those numbers, analysts estimated each city's gross taxable resources, made up of city household incomes and business surpluses -- in other words, the main spending power used to pay taxes. For New York, that number is $502.1 billion. The portion of tax capacity being used by government was calculated using direct municipal taxes, estimated state collections within a city, and any overlapping local governments like counties.
The report noted that much of New York City's extra tax burden is due to costs from Medicaid and other need-based programs. While the costs of such programs typically are shared between federal and state governments, New York is different in that it bears more of those expenses.
Source: "NYC is tax capital," Associated Press/BusinessWeek, February 21, 2007; based upon: "Comparing State and Local Taxes in Large U.S. Cities," Independent Budget Office, February 2007.
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