Do Americans really vote with their feet, leaving high-tax states in favor of low-tax states?
While most people don’t move often—and many never leave their home state—we can look at trends and patterns among those who do move across state lines.
I’m not interested in the politics of it. I’m interested in the actual migration numbers compared to tax rates. Set aside your politics for the next five minutes, and let’s focus on the raw population numbers.
After all, population change is the foundation of demand for real estate. By understanding where people are moving, we can understand where real estate markets will boom over the next few years.
Measuring State Tax Burden
First and foremost, how do we compare taxes between states?
Some states charge high income taxes but no sales taxes, and vice versa. Others go heavy on property taxes but light on sales and income taxes.
Fortunately, WalletHub already does the heavy lifting of combining state taxes into one total state tax burden number. It includes the typical percentage of income that residents pay toward state income taxes, property taxes, and sales and excise taxes. If you’re not familiar with excise taxes, they’re additional taxes on items such as alcohol, tobacco, or gasoline.
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Mapped: Tax burden by state
You can see how every state ranks on tax burden in the interactive map below:
We’re mostly interested in comparing the highest-taxed states to the lowest-taxed states, however, to see whether more residents are moving in or fleeing. Without further ado, here are the 10 highest-taxed states:
| Rank | State | Total Tax Burden | Property Tax Burden | Income Tax Burden | Sales & Excise Tax Burden |
|---|---|---|---|---|---|
| 1 | New York | 12.47% | 4.36% | 4.72% | 3.39% |
| 2 | Hawaii | 12.31% | 2.74% | 2.86% | 6.71% |
| 3 | Maine | 11.14% | 5.33% | 2.52% | 3.29% |
| 4 | Vermont | 10.28% | 4.98% | 2.07% | 3.23% |
| 5 | Connecticut | 9.83% | 4.24% | 2.92% | 2.67% |
| 6 | New… |