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This article is pretty vague, and in fact down right sloppy when it comes to making numeric comparisons. It casually mixes up taxable income with gross income,

• hn_throwaway_99 4y ago
  Exactly. You can't compare taxes across states if you're only including income taxes but excluding property taxes. Texas property taxes are ~2.5% for me (and they adjust annually), while CA property taxes are (famously) capped at 1% of the purchase price.
  • bombcar 4y ago
    Adjusted for current values two properties in different states often end up paying similar amounts of tax. It’s just part of the entire picture.
    • mrep 4y ago
      Don't know why you are being downvoted. CA: $788,679 [0] * 0.73% [1] = $5757.3567 TX: $315,235 [2] * 1.69% [3] = $5327.4715. [0]: https://www.zillow.com/ca/home-values/ https://www.zillow.com/ca/home-values/ [1]: https://smartasset.com/taxes/california-property-tax-calculator#:~:text=The%20average%20effective%20property%20tax,%2C%20which%20sits%20at%201.07%25 https://smartasset.com/taxes/california-property-tax-calcula.... [2]: https://www.zillow.com/tx/home-values/ https://www.zillow.com/tx/home-values/ [3]: https://smartasset.com/taxes/texas-property-tax-calculator#:~:text=Texas%20Property%20Taxes,-Photo%20credit%3A%20%C2%A9&text=Property%20taxes%20in%20Texas%20are,Lone%20Star%20State%20is%201.69%25 https://smartasset.com/taxes/texas-property-tax-calculator#:....
      • lotsofpulp 4y ago
        Zillow home value index is not accurate at all in my experience. And Texas does not require property sale prices to be public, unlike most other states.
      • hn_throwaway_99 4y ago
        Presenting a single home index value for all of California or all of Texas is near pointless. Good luck finding a house in Austin that's 315k paying 1.69% in property taxes.
        • mrep 4y ago
          Ok, lets compare SF and Austin then: San Fransisco: $1,576,808 [0] * 1.18248499% [1] = $18,645.5179 Austin: $661,337 [2] * 2.2267% [3] = $14,725.991 [0]: https://www.zillow.com/san-francisco-ca/home-values/ https://www.zillow.com/san-francisco-ca/home-values/ [1]: https://sftreasurer.org/property/secured-property-taxes https://sftreasurer.org/property/secured-property-taxes [2]: https://www.zillow.com/austin-tx/home-values/ https://www.zillow.com/austin-tx/home-values/ [3]: https://www.homecity.com/blog/austin-property-tax/ https://www.homecity.com/blog/austin-property-tax/
    • lotsofpulp 4y ago
      I do not understand how this can be true, given the vast differences in government expenditures across the nation, especially due to things like water and energy costs, maintenance costs from freeze/thaw cycles, and the elephant in the room, underfunded government retiree benefits such as defined benefit pensions and retiree healthcare. Also, I would much rather pay a higher nominal property tax because my property is worth more than pay a higher nominal property tax because the property tax rate is higher.
      • xyzzyz 4y ago
        The government spending grows to fit available revenues, and available revenues grow to fit whatever the taxpayers can still bear.
        • lotsofpulp 4y ago
          >The government spending grows to fit available revenues This is trivial from the fact that the government is not a for profit entity. >and available revenues grow to fit whatever the taxpayers can still bear This is also trivial because taxpayers and voters sufficiently overlap. However, some governments have borrowed more from the future than other governments, and just like a business with more debt service has less to spend on other expenses and/or has less profit, a government with more debt service has to spend less on infrastructure/services and/or has to increase taxes.
          • xyzzyz 4y ago
            > This is trivial from the fact that the government is not a for profit entity. This is not so. Government could use the surplus revenues to pay off debt early, or to reduce taxes. It almost never does these things.
            • lotsofpulp 4y ago
              Oregon does with the infamous kicker rebate. But my point is more that governments (ideally) collect taxes based on projected spending (a budget), so of course spending will roughly match up with collection. Although, in reality, governments spend far more than they collect via off the books retirement benefits for government employees.
  • chomp 4y ago
    ~2.8% for me! And that pie gets bigger every year, even with appraisal protests, my property value is outpacing inflation (9% gains per year). Income taxes are relatively fixed to your salary at least. My property tax (and sales tax) bill grows annually.
• rr888 4y ago
  I'm pretty jealous of prop 13, ever increasing property taxes is brutal.
  • njarboe 4y ago
    While pay taxes is a pain, having a society where people pay different property tax rates creates many problems. Imagine not wanting to move near your new job because your monthly property tax bill would double. Many of California's problems are related to prop 13. At least they recently removed the provision that you could pass your low property taxes down to your children and grand children. We were building up a nice landed aristocracy. Corporations, of course, can live for a very long time and are also covered by prop 13.
    • rr888 4y ago
      I get, maybe somewhere between. I see your nj username, you probably know what its like for people once retired paying $20k for property taxes, its a big temptation to leave.
    • thomascgalvin 4y ago
      > Imagine not wanting to move near your new job because your monthly property tax bill would double. Imagine having to move because your monthly property tax doubled. Our property taxes are assessed every three years, and the price of my home has gone up significantly in the four years since I bought it. These are unrealized gains; my income has not gone up a penny. But, when the assessment is made, my property taxes will skyrocket.
      • lotsofpulp 4y ago
        Imagine having to pay more for bread. Or milk. Or anything else. It is simply inflation. If we accept it in all other places of life, and renters are expected to accept it, why should land owners not be expected to accept it? If your income has not gone up in 3 years, and the purchasing power of the currency you earn income in has gone down, then you simply have to accept you will be able to purchase less. Or figure out a way to make your income go up. Also, participate in city/county/state governments and elections to make sure current leaders are limiting excessive spending from future taxpayers’.
• refurb 4y ago
  That article isn't too convincing since they claim that most of the reason for Texas having a higher effective rate for lower income is sales and excise tax - but the sales tax is 9% in California and 6.25% in TX (~8% with local taxes), not to mention gasoline taxes, etc. Property taxes are higher, but housing prices are lower in TX than CA. From what I've seen they are a bit of a wash (tax rate is double, but housing prices are 50% or less). And in the methodology section it says "The report also includes the effect of indirect consumption taxes: the sales and excise taxes that are paid initially by businesses rather than individuals". So it looks like they assumed those taxes are passed through to consumers when in fact they aren't, at least not 100%. They also exclude all tax payers over 65.
  • baldeagle 4y ago
    "Property taxes are higher, but housing prices are lower in TX than CA. From what I've seen they are a bit of a wash (tax rate is double, but housing prices are 50% or less)." This was true years ago, but the cost of housing in Frisco TX and San Diego CA are about the same now. If anything, San Diego may have an edge because it has many older, smaller properties that keep the overall cost down compared to the newly built up mcmansion land of Frisco.
    • lotsofpulp 4y ago
      > but the cost of housing in Frisco TX and San Diego CA are about the same now. I do not understand this. Do you mean cost of housing excluding purchase price? The cheapest 4BR/3BA in or around San Diego is $1.4M, and there is only 1. Property tax will be at least $14k per year. https://redf.in/s4hVXR https://redf.in/s4hVXR Frisco, TX, on the other hand has a ton of 4BR/3BA, and this is a comparable new construction for $1.4M. 4x the lot size, 2.5x the interior space. https://redf.in/hwqzX8 https://redf.in/hwqzX8
• xyzzyz 4y ago
  That contra articles is very deceiving. The cited data most certainly do not say that “Texans actually pay more in taxes than Californians do”. This is very much false, so false and contrary to common knowledge in fact that you should have went back and asked yourself “wait, is it actually true, or is someone trying to pull a fast one on me?”. Here is the crux of the issue: the graphs and the source do not say that the non-wealthy Texans actually pay more money in taxes. Instead, they contribute higher share of total tax revenue. This is not the same thing as actually paying more in taxes. Imagine a state where every single residents pays exactly one penny in taxes. In that state, bottom 20% pay exactly 20% of the tax revenue, and top 1% pay only 1% of the tax revenue. By the article’s logic, in that state the non-wealthy residents would pay even more taxes than the ones in California. It is, of course, absurd. You cannot look only at the shares in the revenues, you need to also look at the size of the revenues to judge. As it turns out, Texas pulls in around $8.6k per capita in state and local taxes, compared to California’s $13k. That means that even though middle 60% of Texans contribute 10% of the revenues, compared to 9% of revenues contributed by middle 60% of Californians, they actually pay a third less in taxes in actual dollars. In short, the article is pure misinformation, deceiving people for political gain, typical for today’s media. Where are the fact checkers?
  • scifibestfi 4y ago
    That article and the OP are an example of gaslighting and motivated reasoning. "This claim is sloppy, but not this other one that confirms my bias". But really both are sloppy.
  • tristor 4y ago
    It's even worse than that, nearly the entire difference cited is based on property taxes but they use a property for comparison that doesn't exist in California, but does in Texas. As a percentage of home value, property taxes /are/ higher in Texas, but home values are also massively lower (1/3rd or less) in almost all of the state, which means that /actual taxes paid/ for property tax are nearly identical to sometimes less in Texas, /and/ because housing is cheaper, it's more affordable to actually own a home instead of renting forever at lower income quintiles. Anyone who actually looked at the data and concluded that living in California instead of Texas was a better financial deal for someone who is not a high income earner is either stupid or lying.
• jonas21 4y ago
  Yeah, the numbers are extremely sloppy. Even for the basics, like coming up with the marginal tax rate in NY, he uses the top federal, state, and city income tax rates and adds the social security tax to that. But the top federal tax bracket starts at $540k and the Social Security tax cuts out at $142k, so if you're paying one on marginal income, you're not paying the other.
  • pwinnski 4y ago
    That's not just sloppy, it's incorrect! The top-line claim of the author is flat-out demonstrably wrong.
  • mister_tee 4y ago
    I agree they shouldn't have put the 53% marginal claim right next to the social security point, as the max-marginal people will be well past the cap, but the 53% max marginal rate might still be true? 37% federal + 1.45% FICA (medicare) + 0.9% medicare surtax + 10.3% NY state + 3.8% NYC = 53.4+% but I don't work in NYC.
    • the-rc 4y ago
      BTW, between $1M and $1.1M, NYS tax rates switch to flat, not marginal, and apply to the entire income.
  • rmk 4y ago
    He does use or mention a lower effective tax rate. Even though he points out a 53% on-paper tax rate, he mentions 42% as the effective tax rate in the next paragraph. This does seem closer to the truth. He also specifically says that case-by-case numbers are more complicated and vary, so it's not fair to argue that the numbers are extremely sloppy. He has made an attempt to use well-researched average numbers that appear to rely on actual rates people pay, not the theoretical marginal rates. Mentioning the marginal rates is a rhetorical device he uses, not the rate he uses to illustrate the scenarios.
• WkndTriathlete 4y ago
  The numbers are more than sloppy, they are (technically) flat-out wrong. New York State imposes income tax on out-of-state workers based on a convenience of the employer test. (The law was passed when workers started leaving NYC for nearby states when people discovered they could work from home before the pandemic.) So in many cases, even if you don't work in New York, you still get to pay New York State income tax, unless you check a bunch of (rather arbitrary) boxes. The law itself, IMO, should be struck down by the interstate commerce clause. Additionally, it's the wrong fix: if New York wants to retain citizens, they should reduce the tax burden to compete with neighboring states, not attempt to legally overreach and clutch money as hard as they can.
  • Kon-Peki 4y ago
    > should be struck down by the interstate commerce clause I’m not sure I understand why you suggest the interstate commerce clause. But regardless, didn’t the Supreme Court refuse to take up the case earlier this year when New Hampshire unsuccessfully sued Massachusetts over this same issue? It seems that the concept is allowable, at least according to current law.