Study Reveals Income Tax Disparity
A new study shows low- and middle-income people in Ohio and across the country pay a higher percentage of taxes than earners in the top 1 percent.
Jim Letizia reports.
The study by Policy Matters Ohio and the Institute on Taxation and Economic Policy ranks Ohio 18th in the nation for inequality, based on their analysis of 2012 income data. The study also covered tax changes in the states through 2014. It shows wealthier families pay a smaller percentage of their income in taxes than the lowest 80 percent of income earners. The top 1 percent of income earners in Ohio spent 5.5 percent of their income on state and local taxes. Those in the middle 60 percent of income pay on average of 10.2 percent. Most of the bottom 80 percent of Ohioans pay 2 to 4 percent of their income in state income taxes. The top 1 percent of earners pay 1 percent of their family income on sales taxes, while most in the bottom 80 percent pay between 4 and 7 percent. Republican state legislators and governors have cut the state income tax by 30 percent and increased the sales tax by three-quarters of a percent over the past decade. State officials are expected to try to cut the income tax again this year, which the study authors say benefits wealthy Ohioans more.