Washington ranks 29th in national tax report

State and local taxes in 2009 claimed 9.3 percent of Washington incomes, and 9.4 percent in Idaho, according to figures released Wednesday by the Tax Foundation.

The nonpartisan foundation’s calculation of “tax burden” earned Idaho a ranking of 28th, and Washington 29th among the 50 states.

Washington residents paid an average $4,408 in state and local taxes on incomes of $47,361. Idaho residents paid $3,276 on incomes of $34,973.

Washington’s ranking was unchanged from 2008, when taxes equaled 9.4 percent of income. Idaho improved from 20th because the share fell from 9.8 percent.

New Jersey taxpayers pay the biggest tax burden, 12.2 percent. Alaskans pay the smallest, 6.3 percent.

The foundation’s formula includes taxes levied in one state but paid by those in another. Alaska, for example, collects almost 80 percent of its revenues from taxpayers in other states because of its state levy on oil production.

Most taxpayers, the foundation said, are unaware of the tax-shifting that attempts to collect more revenue from out-of-state residents by imposing taxes on hotel rooms and rental cars, or by permitting local-option sales taxes in resort areas.

Report author Mark Robyn said the practice creates a number of economic and political problems.

He noted the average state and local tax burden for all states fell in 2009 compared with 2008, when the share was 9.9 percent. The share peaked at 10.4 percent in 1977.

The decline was the result of taxes falling faster than incomes, Robyn said.

The foundation uses income, sales, property and gross receipts taxes like Washington’s business and occupation tax in its calculations. Assessments for water, sewer and other infrastructure are also plugged in, as are license fees.