The average Floridian pays $123 in state and local taxes for every $1,000 earned in personal income, the fourth lowest rate in the nation, according to a Florida TaxWatch (FTW) analysis released this week.
Of that $123 in state and local taxes for every $1,000 earned, a composite 12.3 percent, Floridians pay $56 in state taxes – second lowest in the nation – and $67 in local taxes, the 11th highest rate in the country and tops for the percentage of local levies within the total tax burden, FTW calculates.
Florida does not levy a state income tax – which accounts for 37 percent of tax collections in the 43 states that do – but it generates revenues through “transaction taxes,” such as sales taxes and service fees, which FTW maintains account for 83.8 percent of all state tax collections, the nation’s 17th highest rate, compared to the national average of 47.7 percent.
According to the report, Florida has the nation’s highest state and local taxes on utilities, nearly three times higher than the national average.
Those are among findings in FTW’s "2019 How Florida Compares" report, a 46-page analysis with nearly 40 tables, graphs and charts that provide a deep dive into a trove of data examining tax collections and other government revenues for all 50 states.
The report is designed to help “Floridians better understand their state through comparing Florida’s taxes to those that are levied across the nation,” the Tallahassee-based non-partisan nonprofit states.
According to the report, Florida’s per capita “own source” state and local tax collections rose $54 from $5,679 in fiscal year 2015 to $5,733 in fiscal 2016, moving the state from 42nd to 40th highest in non-federal tax burden. The national average is $7,188.
FTW’s per capita tax calculations are based on state population estimates from the U.S. Census Bureau and personal income estimates from the U.S. Bureau of Economic Analysis for FY16.
The “own source” metric “counts all direct revenue, including taxes and non-tax revenue such as charges for services, special assessments, impact fees and net lottery revenue. It does not include intergovernmental aid, revenue from government-owned utilities and liquor stores and social insurance funds,” FTW explained.
Under this definition, the $5,733 in “own source” taxes the average Floridian pays includes $3,517 in state/local taxes – 46th in the nation; the national average is $4,956 – and $1,784 in transactional taxes, slightly above the $1,735 national average and higher than those levied in 33 other states.
Although Florida climbed to 40th place in per capita state/local tax collections after ranking 42nd in FTW’s 2014 and 2015 analyses, the tax burden is significantly lower per capita than it was in 2006, when the state ranked 22nd and in 2009, when it was 24th in this category.
According to FTW, since 2006 Florida’s state/local taxes have increased by 13.8 percent while nationwide, they’ve grown by an average of 32.4 percent. The only states with slower growth rates in state/local taxes between 2006 and 2016 are Indiana and Alaska, FTW maintains.
New Yorkers are levied the most in state/local taxes, with an annual per capita average of $11,810. Sparsely populated Alaska, at $10,359, and Wyoming, at $10,183, were the second- and third-highest.
Among other states: 10. Minnesota, $8,396; 12. Iowa, $7,819; 19. Illinois, $7,277; 21. Pennsylvania,$7,106; 22. Colorado, $7,100; 23. Virginia, $7,022; 24. Wisconsin, $6,916; 25. Maine, $6,730; 26. Ohio, $6,688; 27. New Hampshire, $6,608; 30. Michigan, $6,377; 33. North Carolina, $6,147; 35. Texas, $5,993; 36. Louisiana, $5,980; 38. Nevada, $5,946; 47. Georgia, $5,297; 49. Arizona, $5,137.
• Florida’s per capita property tax of $1,278 ranks 24th in the nation. “While state revenue collections began to improve in 2011, it took longer for local property taxes to recover. In 2014, property taxes finally began to reverse a trend of five straight years of declining collections,” FTW said.
• The average Floridian pays $218 a year in state/local utility taxes, tops in the nation and nearly three times the national average of $85. Other excise taxes: motor fuels, $166 (17th highest, national average $140); insurance, $35 (44th/$63); alcoholic beverages, $19 (21st/$23); tobacco, $60 (28th/$57)
• Florida’s state/local cell phone tax rate of 14.83 percent is the nation’s ninth highest even after the Legislature reduced the state’s communications services tax in 2017.
• “Florida’s documentary stamp taxes are rising rapidly again after falling sharply during the recession. Florida collected $276 of these taxes per capita in 2006, but that amount fell to $72 in 2009,” FTW reports. “Housing is improving again, and per capita collections have risen to $138 in 2018, the nation’s third largest burden.”
• Businesses pay 53.6 percent of all state and local taxes in Florida, the ninth highest percentage in the nation and higher than the national average of 43.7 percent.