Texas Is The 20th Most ‘Tax-Friendly’ For Middle Class: Study

Texas is the 20th most tax-friendly state in the country for the middle class. That’s according to a study published Wednesday by the personal finance site GOBankingRates.

State and local income taxes vary from state to state, and some impact middle-class earners more than others. The authors noted not all states are equal when it comes how much residents pay in taxes due to owning property, buying goods and submitting to a personal income tax.

“The best states for taxes, as well as the worst, exist,” the authors said.
Here’s what the authors found for Texas:

• Total share of state and local taxes paid by middle 20 percent: 9.7 percent
• Share of personal income tax paid by middle 20 percent: 0 percent
• Share of property taxes paid by middle 20 percent: 2.9 percent
• Share of sales and excise taxes paid by middle 20 percent: 6.8 percent

“Texas is one of the few states that doesn’t impose a state income tax on residents, but the state’s share of sales and excise taxes and property taxes for the middle 20 percent are some of the highest on the list,” GOBankingRates reported.

The study determined the most tax-friendly states for the middle class by looking at the shares of certain income taxes paid by the middle 20 percent of income earners in 30 states.

Of particular interest, no state in the South — often associated with lower tax rates — cracked the top five most-tax-friendly states for the middle class. And just three managed to crack the top 10.

1. Alaska
2. Delaware
3. Nevada
4. Wyoming
5. Montana
6. Florida
7. Tennessee
8. Idaho
9. South Carolina
10. North Dakota

Alaska ranked as the No. 1 most tax-friendly state for middle class folks. The authors highlighted that the middle 20 percent in Alaska pay the lowest total share of state and local taxes at 4.3 percent. The state also has no personal income tax and has the fifth-lowest share of sales and excise taxes paid by middle class earners at 1.6 percent.

Patch national staffer Dan Hampton contributed to this report.

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