Massachusetts couples pay the highest percentage of income in taxes in the country, report says

It’s tax season, and in news perhaps unsurprising to Bay State taxpayers, couples living here have to shell out the highest percentage of their income on taxes.

“The biggest takeaway for me was just how vast the spread can be across the country,” said Josh Koebert, who authored the study on FinanceBuzz.com, in an email.

He noted that the difference between states like Florida and Massachusetts was 50%. “That is a huge difference,” he said, “50% more paid in taxes annually, almost all of which comes down to state-level income tax laws.”

The study compared the median income for full-time workers in each state, derived from the U.S. Census Bureau, against the federal and state tax rates for the 2021 tax year.

Massachusetts took the top spot for couples filing jointly, with couples paying 23.51% of their income in taxes. Close behind is Oregon, at 23.24%, Hawaii, at 23.05%, and Connecticut, at 22.99%. The lowest rate was in Tennessee, with taxpaying couples owing just 15.54% of their income to taxes.

For single filers, Massachusetts earned the number two spot, at 23.23%. Oregon edged out Massachusetts at 23.37% to take the top spot. Connecticut and Hawaii fell not far behind, and Florida singles took the bottom spot, with 15.52% of their median income owed to taxes.

The report notes that Massachusetts residents pay the highest federal tax rate in the country, at 18.58%, which is attributable to having the highest median annual income in the country.

Eileen McAnneny, of the Massachusetts Taxpayers Foundation, made the same observation, but also noted that our expensive real estate also contributes to a high property tax. Massachusetts also has an income tax,

Paul Diego Craney, of the conservative Mass. Fiscal Alliance, reminded the Herald that state lawmakers are proposing a ballot measure that would raise the income tax on the wealthiest earners, as well as some businesses.

“The public needs to realize that when they send part of their paycheck to the legislators at the Statehouse to spend, they are already the most generous in the country and yet lawmakers still want more,” he said.