The cost-of-living crisis triggered by historical inflation recorded in 2022 in the US has caused at least 11 states cut taxes.
Most of these states are led by Republicans, they have reduced taxes for residents, according to the tax fund. This is a list of 11 states that are cutting state taxes:
1.- Arizona
He enacted a flat plan to eliminate his tax bracket, which had a top tax of 4.5% on income over $159,000 a year. Now, all taxpayers will pay a maximum rate of 2.5%.
Overall, the plan will save taxpayers an estimated $1.9 billion next year, though critics say the plan mostly benefits the richest.
2.-Arkansas
Highest personal income tax rate in Arkansas fell to 4.9% from the previous high of 5.9%..
3.- Idaho
Idaho accepted flat personal income tax rate of 5.8% which will come into effect this year. This compares to the previous maximum rate of 6%.
4.- Indiana
Fixed rate tax on the state’s individual income was reduced from 3.25% to 3.15%.starting from 2023 and 2024. There are certain factors that could lower the rate further to 2.9%, subject to certain conditions.
5.- Iowa
However, this year Iowa will begin to phase in a flat tax of 3.9%. the change will be in effect for four years. Some residents will see the benefits before others.
6.- Kansas
The state has implemented the first stage of the plan for abolish taxes on food. From January 1, the state tax on products has been reduced to 4% instead of 6.5%. The tax will continue to decline until it reaches zero in 2025.
7.- Kentucky
Personal income tax rate fell from 5% to 4.5%but the sales tax will now apply to a range of new services, including car rentals, ridesharing and taxi services.
8.- Missouri
Under new tax laws, Missouri’s top personal income tax rate fell to 4.95% in January from the previous rate of 5.3%. Same, the first $1,000 of income is now tax-free.
9.- Mississippi
The 4% tax on taxable income between $5,000 and $10,000 will be removed from January; instead of, there will be a flat tax of 5% on rent over $10,000. This tax rate will decrease to 4.7% in 2024, 4.4% in 2025 and 4% in 2026.
10.- New York
New York has accelerated the reduction income tax rate for middle income familiesand rate cuts originally scheduled for 2025 should now take effect this year.
The tax rate on income from $13,900 to $80,650 for single applicants will be reduced to 5.5%. For individual taxpayers earnings from 80,650 to 215,400 dollarsthe tax rate will be reduced to 6%.
11.- North Carolina
single tax rate will be reduced to 4.75% in 2023.compared to the previous rate of 4.99%.
Source: La Opinion
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