Bearing the burden of government
Another way to view tax burdens is the proportion of its income that comes from residents, and the Tax Foundation ranks states in this fashion. The states with the lowest individual tax burdens tend to be in the South and West, although California imposes one of the highest burdens, with 11.2 percent of state income generated by individual taxes. That’s a notch below New York’s 12.8 percent, which leads the nation. New York's reliance on taxes nearly doubles Alaska's, which, at 7 percent, is the least burdensome state, according to the foundation.
Then again, a state's overall level of tax dependency doesn't necessarily correlate with the relative burden it places on low-income residents. Five of the foundation's least tax-dependent states are among the most "regressive" states in the nation, meaning the bottom 20 percent of earners bear the largest burden as a percentage of earnings, according to the Institute on Taxation and Economic Policy's study.
Taking the findings of the Institute and Tax Foundation together reveals that Nevada, Alabama, Texas, Tennessee and South Dakota residents as a whole pay relatively little to their state capitals, but residents who pay most in those states -- as a percentage of income -- are those who can least afford it.
And, despite its heavy reliance on taxes, New York is one of least regressive states in the nation, according to the institute. That's because of its "generous" earned income tax credits and high top rates on income taxes, the study states.