NJ Among Worst In Nation For Tax Rate, New Study Says

NEW JERSEY — Residents may not be surprised that the Garden State ranks low on a national list of tax rates, and leads the nation in how much real estate taxes homeowners pay.

The ranking from financial analysts with WalletHub, coming more than a month before Tax Day 2023, takes into account state and local taxes, as well as various types of taxes, ranging from income tax to real estate and excise taxes.

New Jersey came in at 43rd overall on the list, which included all 50 states and the District of Columbia.

NJ was the worst in the nation for real estate tax with an average rate of 8.71 percent, the WalletHub ranking showed, and has one of the highest gas tax rates in the nation as well. Related article —NJ Has Nation's Highest Property Taxes, By A Long Shot: Report

The state’s effective sales and excise tax rate was ranked at 7th in the nation, and the Garden State was 10th in the nation for income tax rate.

The report also included figures for annual vehicle-property taxes, which New Jersey residents do not pay along with residents of 23 other states and the District of Columbia.

Analysts say that recent inflation and lingering economic concerns in a post-pandemic world have made people hyper-aware of their bank accounts. It's also put many people who weren't financially vulnerable five years ago in a difficult position.

"Perhaps people feel that a tax break is necessary to lessen the pressures of inflation,” Jill Gonzalez, WalletHub analyst, said in a statement. “Another reason why people think their current tax rate is too high could be that they feel the benefits they receive from the government do not equal the money subtracted from their income. They may also disagree with how their tax dollars are being used or think they are being used inefficiently.”

Wallethub also included an smörgåsbord of eclectic, tax-adjacent statistics along with the study that served as indicators of the modern economic realities most Americans face. One of these indicators? More than 81 percent of people are more worried about inflation than taxes.

And more than 70 percent of Americans agree on these two things: that their current tax rate is too high, and that the government does not spend their tax dollars wisely.

Amongst the other findings: apparently 23 percent of people claim that to avoid taxes forever, they would stop speaking for 6 months.

Perhaps even worse, 37 percent of people would get an "IRS" tattoo if it meant they'd never be taxed again.

The study did not note where on the hypothetically untaxed body the IRS tattoo would be located.

Patch’s Justin Heinze contributed to this report.