Data shows that Texans pay more tax than Californians

Ash Jurberg

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Despite the perception that Texas is a low-tax state, a recent post on Reddit’s main economic forum shows that this is incorrect and, in fact, most Texans pay more taxes than Californians.

The data was collected by the Institute of Taxation and Economic Policy (ITEP) and showed that Texans in the bottom 20 percent income group pay 13 percent of their income in state and local taxes. This compares to Californians in the same bracket who pay just 10.5 percent in state and local taxes. Middle-income Texans also pay more taxes than their Californian counterparts.

The ITEP Tax Inequality Index ranks states in order of rank from least equitable to more equitable. This index ranked Texas as the second least equitable state for taxes. This means the lower income earners bear more tax burden than higher income earners in the state. Only Washington performed worse on this tax inequality index.

The report from ITEP states:

In Texas, before state and local taxes are collected the top 1 percent of taxpayers earn an average income that is 124 times larger than the average income of the state’s poorest 20 percent of residents. This state’s tax system, which ranks as the second most regressive on the Index, only exacerbates this divide. After state and local taxes are collected, the average after-tax income of Texas’s top earners stands at 140 times the size of the average after-tax income of the state’s low-income residents. This is the predictable result of charging low-income families a 13.0 percent effective tax rate, while asking high-income families to pay just 3.1 percent of their income in tax.

The Reddit post highlighting this graphic has gone viral this week, with many Texans sharing it on Twitter.

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Do you believe Texans pay too much tax? Do you think the top-income earners should pay more and that lower-income earners should pay less tax?

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