With Tax Day less than six weeks away, a recent report from personal finance company, WalletHub, shows Iowa has one of the highest tax rates in the nation for its residents. Iowa has the seventh-highest effective state and local tax rate at 13.2 percent of the U.S. median income, equating to around $8,148 annually. These figures do not include taxes imposed by the federal government. Iowa’s position improved to 36th when adjusted for the state’s relatively low cost of living compared to other parts of the nation. By category, Iowa ranks 29th for income tax, 42nd for property tax, 30th for vehicle property tax, and 34th for sales and excise taxes. Since 2003, Iowa’s average property tax levy has grown by nearly 111 percent, according to Iowans for Tax Relief, while inflation over those 20 years was only 59.1 percent. Alaska, Delaware, and Wyoming claimed the top spots with the lowest effective state and local tax rates, while Illinois, New York, and Connecticut had the highest rates. A more in-depth breakdown of Iowa’s tax rankings is included below.
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