Why must state taxes be relatively low?

Why State Taxes Must Be Low

Every April 15 , Americans gripe about having to give anything from 10 -35 of their paycheck to the government in income taxes . Unless an individual lives in Alaska , Nevada , South Dakota , Washington , Wyoming Texas , or Florida , he would have to pay state income taxes in addition to the national tax . In addition , Tennessee and New Hampshire limit income taxes only to income that is not a result of employment such as dividends and interest income . Nevertheless , there are several reasons why many states prefer to keep

their taxes relatively low . First paying a large state income tax on top of a heavy federal tax may be perceived as highway robbery to a high-income person . Therefore , states have to worry about such people moving to areas that impose very low (or no ) taxes on income as the wealthy usually contribute to business development and creating jobs to ensure that will make the state a great place to live and work . As the state government benefits from the start-up of new businesses and a highly skilled workforce , they would logically want to make their state as attractive as possible . The states are currently being kept aloft by revenue systems that have undergone restructuring in the past decade . They are now much more sensitive to changes in personal and corporate income (Smith , 184

Secondly , the American Revolution was fought over taxes and the people are extremely resistant to increases in taxes . Tea Parties were staged in cities...