States Taxes: Where They're Highest, and Where They're Lowest

States with the highest taxes
States with the highest taxes

When people think about their taxes, they often focus on how much money they send to Washington, but your state and local tax burden is a big piece of the puzzle -- as of 2010, those taxes soaked up, on average, 9.9% of Americans' income. But the figure varies widely depending on where you live.

You might expect the biggest thing pushing those taxes lower would be small-government advocates in power in state capitals trimming services and revenue to match. And to a degree, says Tax Foundation economist Scott Drenkard, that's true. Many states do less for their citizens, and thus have less need to tax. "They don't collect that much in taxes" Drenkard said, "so they don't have that much of a burden."

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But the most important factor is less obvious: How much tax revenue a state can collect from businesses and people who don't live there. Think oil- and resource-rich states like Alaska and North Dakota, or Nevada, which draws a large percentage of its revenue from tourism.

There's also the matter of what gets taxed: While sales and excise taxes and corporate taxes have the potential to export some of a state's tax burden to non-residents, property tax and income taxes largely fall on residents.

Click through our gallery to see the 10 states where residents paid the most in state and local taxes relative to per capita income -- and the 10 where they paid the least.

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24/7 Wall St. based its findings on the Tax Foundation's annual State and Local Tax Burden report, and also reviewed per capita income and property, income, excise and sales taxes, which were all for the 2010 fiscal year, with the exception of excise tax rates, which are as of July 1, 2012. In addition, it reviewed cost-of-living data from the Missouri Economic Research and Information Institute for the second quarter of 2012.

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