Comparative Federal Tax Contribution by State

[saden1]

Originally Posted by GMScud

For real. I enjoy political discussion in-person with friends, by my motto for the parking lot is the same as your current user title - f...political threads. However, this is impressive stuff.

I do love reading Parking Lot threads though...

Question- how do you determine the dollar amount of what (ideally) each state's "fair share" should be?

Thanks guys, it was a great learning experience.

The total Federal tax contribution (~2.6 trillion) divided by total population of the United States (~306 million) gives you ideal contribution per capita. If a State houses 10% of the population it should pay 10% of the tax burden. The effective tax rate throws a monkey wrench into our ideal world scenario so that has to be factored in.

New York for example has the highest DI index because it has 6.32% of the population and pays 9.15% of the total tax burden (+2.83%). When you factor in the aid money they receive they have an effective tax rate of 7.53%. That is to say even though they make up 6.32% of the population they still pay 7.53% of the effective tax (1.21% more than they should).