Texas Has the 3rd Most Unfair Tax System in the U.S.

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Brakeyshia Samms, State Policy Fellow

In Texas, we like to pride ourselves as being the standard-bearer of many things across the country. Unfortunately, our tax system leaves a lot to be desired. The latest update of Who Pays? by the Institute on Taxation and Economic Policy reveals that Texas has the third most unfair (or regressive) tax system in the entire country. This means that Texans who are least able to afford it pay more in taxes as a percentage of their income, than those who could easily afford to pay more.

10 most regressive tax systems

ITEP’s report reveals that the poorest Texans pay four times as much in taxes, as a percentage of income, than the wealthiest 1 percent; middle-income Texans pay three times as much.

Income quintiles

Many Texas politicians brag about Texas being a low-tax state. But Texas is not a low-tax state for low-income families because we ask them to pay an unusually high percentage of their income in taxes. As the chart below shows, Texas is tied for 5th place in having the highest taxes on the bottom 20 percent.

Highest taxes on poor

With the 84th Legislative Session now underway, state policymakers should be proposing ways to improve our tax system so it is fair and capable of supporting public services that we all use and benefit from everyday.

 

At the Center for Public Policy Priorities, we believe in a Texas that offers everyone the chance to compete and succeed in life. We envision a Texas where everyone is healthy, well-educated, and financially secure. We want the best Texas - a proud state that sets the bar nationally by expanding opportunity for all. CPPP is an independent public policy organization that uses data and analysis to advocate for solutions that enable Texans of all backgrounds to reach their full potential. We dare Texas to be the best state for hard-working people and their families.

1 Comment

  • Ms. Samms argues regressive taxes are unfair to poor people.
    We rich people think progressive taxes are unfair to rich people.
    We’ve figured out how to stick the poor with paying for public services.

    Townsend Harris 08.03.2016

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