Show-Me Institute Presents: Comparing Income Tax Liability Across States: Where Does Missouri Rank?

Economy | October 27, 2015

By Rik W. Hafer | Read Time 1 minute minutes

There has been a lot of back and forth regarding whether Missouri is a low-tax state. The truth depends on which tax one looks at. Missouri has the lowest cigarette taxes in the country, but its combined state and local sales taxes rank amongst the highest in the country.

My colleague Rik Hafer and I decided to compare Missouri’s income taxes to those of other states. In our anaylysis, we went beyond looking at states’ top marginal income tax rates or income taxes collected per capita. Using tax preparation software, we examined how much an average family of four would have to pay in income taxes in each state. This is a new way to look at how income taxes actually affect households by giving people an idea of how much they would owe if they were to live in a particular state.

So where does Missouri rank? Give our paper a look and find out.

20150814 – Compairing Income Tax Liability Accross States – Hafer_Rathbone.pdf

About the Author

Rik W. Hafer

Rik Hafer is an associate professor of economics and the Director of the Center for Economics and the Environment at Lindenwood University in St. Charles, Missouri. He was previously a distinguished research professor of economics and finance at Southern Illinois University Edwardsville. After receiving his Ph.D. from Virginia Tech in 1979, Rik worked in the research department of the Federal Reserve Bank of Saint Louis from 1979 to 1989, rising to the position of research officer. He has taught at several institutions, including Saint Louis University, Washington University in Saint Louis, the Stonier Graduate School of Banking, and Erasmus University in Rotterdam. While at Southern Illinois University at Edwardsville, Rik served as a consultant to the Central Bank of the Philippines, as a research fellow with the Institute of Urban Research, and as a visiting scholar with the Federal Reserve Banks of Atlanta and St. Louis. He has published nearly 100 academic articles and is the author, co-author, or editor of five books on monetary policy and financial markets. He also is the co-author of the textbook Principles of Macroeconomics: The Way We Live. He has written numerous commentaries that have appeared in The Wall Street Journal, the St. Louis Post-Dispatch, the St. Louis Business Journal, the Illinois Business Journal, and the St. Louis Beacon. He has appeared on local and national radio and television programs, including CNBCs Power Lunch.

Learn more about this author >