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STATE AND LOCAL TAXES PROPORTIONAL, STUDY CONCLUDES

 ST. PAUL, Minn., Nov. 30 /PRNewswire/ -- The overall distribution of Minnesota state and local taxes by taxpayer income levels is nearly proportional, according to a report released today by the Minnesota Department of Revenue.
 "When taxes are distributed proportionally, taxpayers at different income levels pay similar percentages of their income in taxes," said Robert Cline, department research director. "This is a unique situation when compared with most states where many tax systems are actually regressive."
 According to the "Minnesota Tax Incidence Study," Minnesota's personal income tax is significantly progressive. Taxes are progressive if the percentage of income paid in taxes increases as income rises; they are regressive if the percentage decreases as income rises.
 The report shows that the top 10 percent of the state's taxpayers pay 36 percent of all taxes and nearly 50 percent of the personal income tax; these taxpayers account for 37 percent of the total income of all 1990 state taxpayers.
 The biennial study includes taxes on businesses, which account for more than one-third of Minnesota's state and local tax revenue, as well as taxes imposed directly on individuals. It describes the economic assumptions used to allocate taxes on businesses and households to Minnesota consumers, workers, landowners, investors and nonresidents, who ultimately bear the burden of the taxes.
 New in this year's report are examples of estimates that illustrate state and local taxes paid by typical families with different income levels and household characteristics.
 The "Minnesota Tax Incidence Study" provides an important benchmark that can be used to evaluate Minnesota's state and local tax structure and to measure progress toward tax policy objectives. It provides both legislators and citizens with a better understanding of who pays Minnesota's state and local taxes.
 For further information about the report, call 612-296-3425.
 STATE AND LOCAL TAX BURDENS
 1990 TAXES AS A PERCENT OF INCOME
 Population Taxpayer Taxes on Taxes on
 Deciles Income Range Individuals Businesses Total
 1 Under $4,611 12.5 pct. 5.4 pct. 17.9 pct.
 2 $4,611-7,704 7.5 3.7 11.1
 3 7,705-11,970 7.5 3.2 10.7
 4 11,971-16,788 8.2 3.1 11.3
 5 16,789-21,802 8.4 2.7 11.1
 6 21,803-27,998 9.1 2.6 11.8
 7 27,999-35,716 9.3 2.7 12.0
 8 35,717-45,278 9.4 2.5 11.9
 9 45,279-61,289 9.6 2.3 11.8
 10 Over $61,289 9.3 2.3 11.7
 Total 9.2 pct. 2.6 pct. 11.8 pct.
 Note: Tax burdens are the percentage of income paid in taxes. The rates for the first decile reflect an adjustment to exclude a small number of households with negative income, primarily business losses. Each decile includes 10 percent of Minnesota's taxpayers.
 -0- 11/30/93
 /CONTACT: Leslee Ellen Lane of the Minnesota Department of Revenue, 612-296-0193 or 800-657-3595/


CO: Minnesota Department of Revenue ST: Minnesota IN: SU:

CP-DS -- MN012 -- 8883 11/30/93 16:15 EST
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Date:Nov 30, 1993
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