Monday, April 20, 2009

Some facts about the Personal Income Tax Proposal

HB1747, CD1 proposes to raise personal income tax on higher-income wage earners as one of the ways to raise revenues for the state. The House Finance Committee provided the following facts about this proposal:

The increase would apply to the following taxpayers:

1. Individuals with taxable income OVER $150,000/yr.
2. Head of households with taxable income OVER $225,000/yr.
3. Joint filers with taxable income OVER $300,000/yr.

For example:

1. An individual who makes $200,000 would pay $625 more in income taxes.
2. A head of household who makes $300,000 would pay $938 more in taxes.
3. Joint taxpayers who make $400,000 would pay $1,250 more in taxes.

Based on 2006 income tax collection data:

1. There were 11,472 tax filers who earned more than $200,000
2. There were a total of 471,792 tax filers in 2006.
3. This means that only 2.4% of resident tax filers earned more than $200,000 in 2006.
4. In 2006, the adjusted gross income for this high-income group was $6 billion.
5. In 2006, the adjusted gross income for all filers totaled $26 billion
6. Therefore, the top 2.4% of income tax filers had 23% of the total adjusted gross income.

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