😮‍💨 Most State Income Tax Burdens Have Fallen Since 2000

Key Takeaways

• Twenty-three states have reduced their top marginal income tax rate since 2000.
• Two states removed income taxes entirely, joining six others that do not tax incomes and two more made no changes.
• Thirteen states increased their top rate.
• Data for four states cannot be directly compared due to how 2000s taxes were levied.

😓 Who Increased Their Tax Rates?

Thirteen states (and D.C.) increased the top rate; with Washington registering the most increase.

However Washington’s 7% flat rate is only applicable for earnings from stocks and bond sales that are above $250,000.

The next biggest increase is New Jersey whose top rate went up 4.38pp from 6.37% in 2000 to 10.75% in 2025.