# No, seriously. What the hell do you pay State income taxes for? **URL:** \ **Category:** Great Debates\ **Created:** [December 21, 2010, 11:15pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014 "2010-12-21T23:15:42Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 5:54pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/61 "2010-12-23T17:54:03Z")
> [@Susanann](#): > > If I may suggest… > > YOu might get a better answer, and better insight to what you might want to know, if you rephrase your question, and ask what do we get from the state government that is DIFFERENT today, compared to back in the 1950s’s and 1950’s BEFORE there was any state income tax, back when the sales tax was only 2%, back when the gasoline tax was just 2 pennies a gallon. > . well, I wasn’t around 60 years ago to know that that’s how things were. 😃 but… good modification of the question! anyone care to take a stab? ---
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 5:55pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/62 "2010-12-23T17:55:16Z")
> [@Voyager](#): > > The problem is that in states with local property tax driven schools there came to be big gaps between rich and poor districts in funding, and state and federal courts found this unconstitutional. do you have the federal case for this? I don’t remember if I ever learned it in LS, and I sure as hell can’t recall it now. (don’t care for the state court one though) ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [December 23, 2010, 6:00pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/63 "2010-12-23T18:00:48Z")
> [@Rumor\_Watkins](#): > > well, I wasn’t around 60 years ago to know that that’s how things were. 😃 The good thing about that is that you weren’t around to _think_ you know how things were, either. State income taxes have been around since 1911. ---
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 6:04pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/64 "2010-12-23T18:04:04Z")
> [@Really\_Not\_All\_That\_Bright](#): > > The good thing about that is that you weren’t around to _think_ you know how things were, either. State income taxes have been around since 1911. Well I mean to be fair, a lot of those services that were taxed at low rates were probably debt financed up the wazoo, which we’re paying a big part of now. but I don’t think debt obligations is what has seen the amount of state taxes go up while the amount of services it provides (comparative to the mid 20th) hasn’t really. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [December 23, 2010, 6:26pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/65 "2010-12-23T18:26:08Z")
That’s because state budgets are broadly the same now as they were then. [The difference is that they now include healthcare](http://www.usgovernmentspending.com/year1955_0.html#usgs302)\*. In 2000, state budgets comprised 7.61% of GDP. In 1980 they were 6.22% of GDP. In 1960 they comprised 4.21% of GDP. The difference is easy to spot: in 1960, state governments spent 9% of their budgets on health (click on the icons at the bottom of each column in the link to get a pie chart). In 2000 they spent 28% of their budgets on it. Now, here’s the funny thing: state healthcare budgets have nothing to do with property or income taxes. 98% of the money is Federal Medicaid spending, which the individual states administer. \*Warning: link leads to a crazy right wing site, but I assume the data are accurate. ---
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 6:29pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/66 "2010-12-23T18:29:06Z")
> [@Really\_Not\_All\_That\_Bright](#): > > Now, here’s the funny thing: state healthcare budgets have nothing to do with property or income taxes. 98% of the money is Federal Medicaid spending, which the individual states administer. how does this jive with the cites above that medicaid spending is gobbling up state revenue? do they count federal transfer payments as revenue? if so, we’re back to square one. where is the state tax money going! ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [December 23, 2010, 6:36pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/67 "2010-12-23T18:36:20Z")
Who said Medicaid spending is gobbling up state revenue? Medicaid spending is purely Federal; it just gets included in state budgets because the states administer it. ---
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 6:42pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/68 "2010-12-23T18:42:28Z")
> [@Really\_Not\_All\_That\_Bright](#): > > Who said Medicaid spending is gobbling up state revenue? Medicaid spending is purely Federal; it just gets included in state budgets because the states administer it. Most of the budgets on page 1 have “Health & Human Services” or a variant thereof as the chief expenditure in the state. I assumed that that was all medicaid, because any of that stuff I’ve ever looked into has been means tested to serve impoverished families. and isn’t that exactly what you posted yourself? “The difference is easy to spot: in 1960, state governments spent 9% of their budgets on health (click on the icons at the bottom of each column in the link to get a pie chart). In 2000 they spent 28% of their budgets on it.” ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 23, 2010, 6:49pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/69 "2010-12-23T18:49:37Z")
> [@Rumor\_Watkins](#): > > do you have the federal case for this? I don’t remember if I ever learned it in LS, and I sure as hell can’t recall it now. > > (don’t care for the state court one though) [Here is one for NJ.](http://lawlibrary.rutgers.edu/courts/supreme/m-622-96.opn.html). But not the one I was thinking of, since that predated when I left the state. That is a state Supreme Court decision - I think maybe most of these are at the state level, which is why there has been no discussion of equalizing funding across state boundaries. [Here is one for California](http://www.schoolfunding.info/states/ca/lit_ca.php3). I found an article saying that the US Supreme Court ruled that the states (Texas in the case) were not constitutionally mandated to provide an adequate education for students. ---
**Author:** ![Susanann](https://avatars.discourse-cdn.com/v4/letter/s/7ab992/32.png) [@Susanann](https://boards.straightdope.com/u/Susanann)\ **Post date:** [December 23, 2010, 7:35pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/70 "2010-12-23T19:35:31Z")
> [@Really\_Not\_All\_That\_Bright](#): > > The good thing about that is that you weren’t around to _think_ you know how things were, either. State income taxes have been around since 1911. No. You are wrong! My state had no state income tax in 1911, and most other states did not have a state income tax either. Additionally, state gasoline taxes were much lower, state sales taxes were much lower, state business taxes were lower, etc ---
**Author:** ![Susanann](https://avatars.discourse-cdn.com/v4/letter/s/7ab992/32.png) [@Susanann](https://boards.straightdope.com/u/Susanann)\ **Post date:** [December 23, 2010, 7:40pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/71 "2010-12-23T19:40:00Z")
> [@Rumor\_Watkins](#): > > well, I wasn’t around 60 years ago to know that that’s how things were. 😃 > ? Well, then, ask your grandpa how much he himself paid in state income tax in 1950. While you are at it, ask him what benefits you are getting from the state that he did not get . Are MORE new roads being built today per year than were being built 60 years ago? ---
**Author:** ![Rumor\_Watkins](https://avatars.discourse-cdn.com/v4/letter/r/d9b06d/32.png) [@Rumor\_Watkins](https://boards.straightdope.com/u/Rumor_Watkins)\ **Post date:** [December 23, 2010, 8:04pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/72 "2010-12-23T20:04:09Z")
> [@Susanann](#): > > Well, then, ask your grandpa how much he himself paid in state income tax in 1950. > > While you are at it, ask him what benefits you are getting from the state that he did not get . Are MORE new roads being built today per year than were being built 60 years ago? All my grandparents are dead, thanks. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [December 23, 2010, 8:04pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/73 "2010-12-23T20:04:39Z")
> [@Susanann](#): > > No. You are wrong! > > My state had no state income tax in 1911, and most other states did not have a state income tax either. > > Additionally, state gasoline taxes were much lower, state sales taxes were much lower, state business taxes were lower, etc No. You are wrong! ---
**Author:** ![Susanann](https://avatars.discourse-cdn.com/v4/letter/s/7ab992/32.png) [@Susanann](https://boards.straightdope.com/u/Susanann)\ **Post date:** [December 23, 2010, 8:36pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/74 "2010-12-23T20:36:07Z")
Originally Posted by Susanann No. You are wrong! **My state had no state income tax in 1911** , and most other states did not have a state income tax either. > [@Really\_Not\_All\_That\_Bright](#): > > No. You are wrong! > [@Really\_Not\_All\_That\_Bright](#): > > The good thing about that is that you weren’t around to _think_ you know how things were, either. State income taxes have been around since 1911. OK, prove it. What was my (non-existent) state income tax rate in 1911? What was my (non-existent) state income tax rate in 1960? Give a list of \*\*all \*\*the state income tax rates from 1911, up thru 1960, and what the tax rates were 50 years ago in 1960 for all the states. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [December 23, 2010, 8:46pm UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/75 "2010-12-23T20:46:18Z")
How about you provide a citation for _any_ of the bullshit you spout first? ---
**Author:** ![fumster](https://avatars.discourse-cdn.com/v4/letter/f/e9c0ed/32.png) [@fumster](https://boards.straightdope.com/u/fumster)\ **Post date:** [December 25, 2010, 9:33am UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/76 "2010-12-25T09:33:07Z")
Here is a [list](http://www.taxfoundation.org/taxdata/show/326.html)of when state income taxes were enacted ---
**Author:** ![fumster](https://avatars.discourse-cdn.com/v4/letter/f/e9c0ed/32.png) [@fumster](https://boards.straightdope.com/u/fumster)\ **Post date:** [December 25, 2010, 9:47am UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/77 "2010-12-25T09:47:11Z")
So 32 states have personal income taxes for over 70 years, one has had it for 49 years. 35 states have had corporate income taxes for more than 50 years, ---
**Author:** ![Rachellelogram](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rachellelogram/32/8689_2.png) [@Rachellelogram](https://boards.straightdope.com/u/Rachellelogram)\ **Post date:** [December 28, 2010, 4:41am UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/78 "2010-12-28T04:41:32Z")
highways, hookers, and blow or just the first one ---
**Author:** ![MsRobyn](https://avatars.discourse-cdn.com/v4/letter/m/90ced4/32.png) [@MsRobyn](https://boards.straightdope.com/u/MsRobyn)\ **Post date:** [December 28, 2010, 5:44am UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/79 "2010-12-28T05:44:35Z")
I just looked over the [2010-2011 Pennsylvania state budget](http://www.portal.state.pa.us/portal/server.pt/document/938102/10-08-31_2010-11_enacted_tr_wtih_10-11_freeze_web_version_pdf) (Caution! PDF that downloads to your computer). The state covers: [ul] [li]Executive offices (governor/lieutenant governor)[/li][li]Legislative offices, including services provided to citizens[/li][li]Education, including K-12 and higher education. This includes college student aid.[/li][li]Agriculture. [All those products marked Reg. Penna Dept. of Agriculture](http://www.straightdope.com/columns/read/306/why-is-reg-dept-penna-agr-on-so-many-labels) have to be inspected by _someone_.[/li][li]Health, including Medicaid, CHIP, and other insurance programs[/li][li]Economic development, including tourism[/li][li]Conservation of natural resources and environmental protection, including Fish and Game. Given that PA has a significant amount of coal and now that the [Marcellus Shale](http://en.wikipedia.org/wiki/Marcellus_Shale) is being exploited, this is not a minor area.[/li][li]Law enforcement, including background checks, state police/crime lab and corrections[/li][li]Labor and Industry, including state regulation of industries, unemployment compensation, job training, and so forth[/li][li]Military and veterans’ affairs, including the National Guard/Air National Guard pay and benefits not covered by the federal government[/li][li]Welfare[/li][li]Transportation, including motor carrier regulation, highway maintenance (not that the state does a good job of that)[/li][li]The judiciary[/li][li]Emergency management. Someone has to deal with all the snow.[/li][/ul] There are, of course, other services and costs that the state pays, but these are subsumed under the categories I listed above. Considering how little I pay in state taxes (and we usually get some back every year), I’m getting a pretty good deal. And, of course, Airman is in the Air National Guard, so we get some pay and other goodies that way. (For example, the state covers part of his military life insurance premiums.) I use (or have used) just about everything I listed above. My food is safe; the roads I travel on are adequate; I was educated at a state-supported college, as was Airman; my son attends public school; and my state attracts tourists, who pay taxes so I don’t have to. Yes, I know that other people pay a lot more than I do. But even they benefit from at least some of the state’s services. ---
**Author:** ![BobLibDem](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/boblibdem/32/3149_2.png) [@BobLibDem](https://boards.straightdope.com/u/BobLibDem)\ **Post date:** [December 28, 2010, 11:28am UTC](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014/80 "2010-12-28T11:28:44Z")
> [@pravnik](#): > > Sales tax, franchise tax, crude oil tax, natural gas tax, gasoline tax, occupation tax, etc. I’m far from an expert, but from what I undertstand the oil and gas industry basically makes it possible to get by without a state income tax. > > ETA: Or what Northern Piper said. 🙂 In other words, oil producing states are leeches, sucking money away from non-oil producing states. [Previous page](https://boards.straightdope.com/t/no-seriously-what-the-hell-do-you-pay-state-income-taxes-for/565014.md?page=3)