How NJ’s income and property taxes compare to other states
A new study on income tax collections across the country finds some states collect more income taxes from their residents than New Jersey, but not many.
“New Jersey collects $1,479 per capita in individual income taxes, that ranks 8th highest in the country,” said Scott Drenkard, the director of state projects at the Tax Foundation.
“Maybe some Jersey residents would be a little bit surprised that it’s not higher, because it often feels pretty high," he added.
The top marginal rate in New Jersey is 8.97 percent, which is one of the highest rates in the nation.
“However, there are significant deductions and credits, and then also the benefit of some lower brackets that some get that make the tax a little less productive from a revenue standpoint," he said.
He noted the Garden State is not among the top three states for income tax collection. But the state does make up for it with the highest property tax in the country at $3,000 per person.
“You’re getting hit in a couple of different tax instruments all the time: The income tax is high, the property tax is high, the sales tax is relatively high as well,” he said.
“It seems as though there’s no place to hide if you’re a resident of New Jersey, and that’s not really the best place to be in.”
He added New Jersey is a great place to live, “but there’s always this question of whether you’re getting what you pay for in terms of the taxes that residents contribute every year.”
Drenkard pointed out the state collecting the most in per capita state and local individual income tax is New York ($2,789) followed by Connecticut ($2,279)
The state with the lowest per capita individual income tax collection is Tennessee ($46) followed by New Hampshire ($72). Both tax investment income but not wage income.
Seven states don’t levy any individual income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.
You can contact reporter David Matthau at David.Matthau@townsquaremedia.com