Tax Day can be a painful reminder of our large investment in the operation of federal, state and local governments, though many of us are unaware of their precise roles in everyday life. As a result, this creates a disconnect in the minds of taxpayers between the amount of money we should fork over every April and how much we ultimately deserve in return from our government.
Perhaps that’s why nearly three out of five U.S. adults feel they pay too much in taxes and why Americans estimate that Uncle Sam wastes slightly more than half of every tax dollar — higher than what they approximate state and local governments squander. We do know, however, that taxpayer return on investment, or ROI, varies significantly based on simple geography. Federal income-tax rates are uniform across the nation, yet some states receive far more federal funding than others. But federal taxes and support are only part of the story.
Ideological differences regarding the role of local taxation have resulted in dramatically different tax burdens. This begs the question of whether people in high-tax states benefit from expectedly superior government services or if low-tax states are more efficient or receive correspondingly low-quality services. In short, where do taxpayers get the most and least bang for their buck?
WalletHub sought to answer that question by contrasting state and local tax collections with the quality of the services residents receive in each of the 50 states within five categories: Education, Health, Safety, Economy, and Infrastructure & Pollution. Their data set includes a total of 23 key metrics. Read on for findings, methodology and commentary from a panel of experts.
|‘Taxpayer ROI’ Rank||State||‘Total Taxes Paid per Capita’ Rank*||‘Overall Government Services’ Rank|
*“Per Capita” includes the population aged 18 and older.