How is it that California and Oregon have a 9%+ income tax and Washington has no income tax?

Question

I live in San Francisco and pay California's (in my opinion) outrageous 9.3% tax rate. In looking around I notice that Oregon has a 9% top rate while Nevada and Washington have no income tax. I know that Oregon has no sales tax, so that sort of explains things there. But can someone explain for me the basics of why California appears to be so much more expensive than Nevada and Washington? Is there some way as a California resident I can take advantage of something to avoid paying what appears to be thousands of dollars more than I would pay if I moved to Seattle? Alternately, is there some tax that they pay in Washington that I'm not considering? Finally, is it just that the California government is stupid and inefficient, or are they lacking sources of taxes that Washington state gets?

Answer 1

Most of the difference has to do with Prop 13's effect on California. While anyone who purchases a home pays taxes on the current value of the property, someone who has lived in the same home for years is locked in at a much lower rate. For example, know of someone who purchased home in 1976 for $42,000. Property taxes are less that $250 a year. My property in Oregon is on the tax roles at $85000 and I pay $1300 a year. Like Cali, my tax increase every year at a minimum rate, but in Washingotn that's not the case.

That said, yes, you can save tax dollars in Washington or Oregon over Cali. But you don't have the weather, job oppertunities, entertainment or sports activities that large numbers of people generate. For me, none of the reasons I mentioned was enough for me to want to stay in California or Washington. I much prefer the slower pace of life, the fewer people, and the reduced cost of living on the south coast of Oregon. No, I don't make the high salary I could make in either state, but I make what I need to live where i want to live.

Answer 2

California total tax revenues are $2,724.31 per person. Washington states tax revenues are $2,359.99. Oregon's are $1,791.45. California has a 6.25% general sales tax, Washington has a 6.5% general sales tax. Oregon has none.

These are state government collections--there are also local government taxes to consider.

It's a complicated question whether tax rates are high because of government inefficiency or because of other reasons. For example, a higher percentage of disadvantaged people in a state can cause more need for government services.

Answer 3

As a current resident of Washington and a former resident of Oregon and California, I may know the answer. Okay, in Washington, there is no income tax however, there are hefty property and sales taxes. In Oregon no sales tax but the property taxes there are INSANE. California has a lot of public programs that the whole community enjoys which is why it is taxed so (schools, public works) being the most populous state in the union with one of the lowest property ownership ratios. California also has the largest number of extremely wealthy individuals and the largest number of residents below the poverty line. That is the reason for income tax That being said, I am in support of taxes (as weird as that sounds) They support our schools and services that we need. People like to complain about paying taxes and complain about closing schools and letting criminals free from overcrowded and underfunded prisons. I wish this was all free but until then I will be happy paying taxes.

Answer 4

Different states generate revenue in different ways. Staes without an income tax usually make it up in sales and use tax, property tax, franchise tax... Texas has been under fire for the last few years for their exhorbitant property taxes to support the school system. They don't have an income tax so they have to get it from somewhere.

There's also the fact that some states manage money better than other. Make your vote count.

Answer 5

I definitely do. Despite minimum wage being pretty high, it's still close to hopeless to try to pay one's bills on such a tiny income after taxes. And yet, STILL the schools cry poverty. Oregon pretty much represents the pinnacle of the poor economic understanding that comes with mass cultural Leftism. As long as the guys got a "D" next to his name, the people will keep voting for this crap.

Answer 6

They make it up some other way - license plates, drivers' licenses, building permits. I truly believe they get the money some other way. Nevada has the casinos to help contribute.

Answer 7

I think it is b/c they like to spend it on different things and waste money. They don't ever want to save it.

Sincerely,
Samantha Thompson

E-mail me if you have any questions.

lil_samiam101@ yahoo.com