Illinois out of luck in bang for its buck
Illinois out of luck in bang for its buck
March 16, 2006. Copyright by the Associated Press
WASHINGTON -- While taxpayers in New Mexico got back $2 in federal outlays for every $1 they sent to Washington, taxpayers in Illinois got back just 73 cents, according to a new Tax Foundation study.
The study released today used new 2004 spending data from the Census Bureau and the foundation's own tax calculations to compare taxing to spending in each state.
Compared to other states, Illinois ranks No. 46 in federal spending per dollar of tax, the Tax Foundation concluded. New Mexico, at $2 in outlays for every $1 in taxes, ranked first, followed by Alaska ($1.87 per $1), West Virginia ($1.83 per $1) and North Dakota ($1.73 per $1).
New Jersey ranked last, receiving back only 55 cents per dollar of federal taxes paid.
"The problem isn't the number of dollars Illinois gets back from Washington," said Scott Hodge, president of the Tax Foundation. "It's the number of dollars Illinois sends Washington in the first place."
Illinois taxpayers paid $6,999 per person in federal taxes, compared to just $4,927 per person in New Mexico.
"Under today's multirate tax structure, states with greater numbers of higher-income taxpayers, like Illinois, have more people paying at the highest rates," currently as high as 35 percent of adjusted gross income, Hodge explained. "In states where average earnings are lower, a greater percentage of income is taxed" as low as 10 percent.
"In fact, for Illinois to have equaled New Mexico's sweet deal -- $2 back for every $1 it paid in federal taxes -- Washington would have to funnel 20 percent of all federally appropriated dollars to Illinois, an impossible amount," Hodge said. "The only hope for rapid improvement in Illinois' ratio would be a fundamental tax reform that flattened federal income tax rates."
Curtis Dubay, the foundation economist who authored the study, added, "Federal spending programs that are on automatic pilot -- like Medicare and Social Security -- are larger than the amounts that Congress actually controls. Incomes and taxes have stayed high in Illinois for the last decade, which is why the ratio has stayed low, falling one cent from 74 cents in 1994 to 73 cents in 2004. No federal spending program can make up that difference."
March 16, 2006. Copyright by the Associated Press
WASHINGTON -- While taxpayers in New Mexico got back $2 in federal outlays for every $1 they sent to Washington, taxpayers in Illinois got back just 73 cents, according to a new Tax Foundation study.
The study released today used new 2004 spending data from the Census Bureau and the foundation's own tax calculations to compare taxing to spending in each state.
Compared to other states, Illinois ranks No. 46 in federal spending per dollar of tax, the Tax Foundation concluded. New Mexico, at $2 in outlays for every $1 in taxes, ranked first, followed by Alaska ($1.87 per $1), West Virginia ($1.83 per $1) and North Dakota ($1.73 per $1).
New Jersey ranked last, receiving back only 55 cents per dollar of federal taxes paid.
"The problem isn't the number of dollars Illinois gets back from Washington," said Scott Hodge, president of the Tax Foundation. "It's the number of dollars Illinois sends Washington in the first place."
Illinois taxpayers paid $6,999 per person in federal taxes, compared to just $4,927 per person in New Mexico.
"Under today's multirate tax structure, states with greater numbers of higher-income taxpayers, like Illinois, have more people paying at the highest rates," currently as high as 35 percent of adjusted gross income, Hodge explained. "In states where average earnings are lower, a greater percentage of income is taxed" as low as 10 percent.
"In fact, for Illinois to have equaled New Mexico's sweet deal -- $2 back for every $1 it paid in federal taxes -- Washington would have to funnel 20 percent of all federally appropriated dollars to Illinois, an impossible amount," Hodge said. "The only hope for rapid improvement in Illinois' ratio would be a fundamental tax reform that flattened federal income tax rates."
Curtis Dubay, the foundation economist who authored the study, added, "Federal spending programs that are on automatic pilot -- like Medicare and Social Security -- are larger than the amounts that Congress actually controls. Incomes and taxes have stayed high in Illinois for the last decade, which is why the ratio has stayed low, falling one cent from 74 cents in 1994 to 73 cents in 2004. No federal spending program can make up that difference."
posted by Carlos T Mock at 9:22 AM
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