Comparison: State Income Tax, Oregon vs. Florida

In let valuate, Oregon vs Florida, Comparison and Analysis Income appraise, as defined by thefreedictionary. com, is A manoeuvre imposed by g overnment on the annual gains of a person, corporation, or other valuateable building block derived through work, business pursuits, investings, billet dealings, and other sources determined in accordance with the Internal R neverthelessue enter or state law. In laymans terms, Income tax is money taken out of nearlyones pay and given to the brass, state, federal, or in some cases both.Some superfluous draw outions afford, hardly in the states being covered in this essay, being Florida and Oregon, those exceptions impart non bother us as of right now, although we will count on at them later as a point of comparison. Today we ar asking ourselves why Florida has no income tax, but Oregon does. We will look over some things such as raw material tax laws, other tax laws and regulations in the state dissembleing similar matters. We will excessively mozy on over to some population and citizen facts and trends, and relate them to why the government in each state has set up taxes the way they make believe.In the end we will come to a conclusion on why states do what they do, and whether that is a good thing or not. permits first delve into the origins of income tax and the origination in the United States. One of the first income taxes was passed in late 18th century Britain. It was a very small tax at . 08% of income for those making ? 60 and up and it moved up to 10% for anyone lucky enough to make a living of over ? 200. This was the inspiration for the tax proposal during the War of 1812 to provide the government with excess income. The war ended little than a year after the tax was proposed so it was never appointed.During the Civil War, another tax was proposed and implemented, in 1961, being 3% of incomes over 800 sawbucks. Later, in 1894 another tax law overcame it and was made to 2% on incomes over 4,000 dollars, meaning less than one out of ten households even paid the tax. Now lets just say it, of course the studyity of the working class dislikes income tax, or any behavior of tax for that matter, especially income though, because you pick up your paycheck and right in that location you almost always look and see, deduction, deduction, etc. lets take that first part into term though, working class.Working class as defined by thefreedictionary. com is The socioeconomic class consisting of hatful who work for net incomes, especially low wages, including unskilled and semiskilled(prenominal) laborers and their families. This is broadly speaking referred to if you were to turn into political debates or discussions, on how things will affect the working class, and how the candidates will desire to please the working class, blue collar Americans. Generally working class Americans work at basic or low level jobs, i. e. ones you wouldnt need to take college or any paid train to do.Some examples would be Cashier, W arhouse worker, Criminal Henchman okay maybe not that last one. Anyways, if you happen to be one of these flock and found your current residence in the beautiful state of Oregon, you may kick downstairs a not so beautiful state level income tax on each paycheck, advent out at 9. 0%, given you are making somewhere in-between 7,750 and 125,000 dollars per year. 9 Cents to the dollar of your sort outed wages goes to the state government, not to mention a federal rate of 10-28% depending where you fall on that same scale.Although that is a large percentage, we are looking solely at state income tax. Corporations take a crap also had an income tax since 1955. Florida, comparably, has a slightly smaller number, being 0% state income tax, although federal is the same across the board. Although Florida does has corporate income tax, being 5%, instituted in 1971. Florida also had a intangible property tax but that has been revoked since 2 007. Immediately when you are pre moveed with this information, you will ring What is contrary virtually Oregon and Florida, and will affect last making active state income tax? First off, let me congratulate you on your ability to think the exact same way my essay coheres to. Secondly, what is an answer? Population Income tax is only collected on officially recorded income, so what does that have to do with individuals? Whether they work or not. Florida has a population with higher-than-average retirement rate. About 17. 3% of Floridas 18+ trillion residents are retired, which is 65 days or older, which is frequently considered to be the age one quits working or employment. This is compared to Oregon with only 13. 9% of its 3. gazillion citizens being retired. Along with that, the average age of a Floridian is around 2 and a fractional years older (38. 7) than that of an Oregonian (36. 3). These states, presented in percentages, may attend insignificant in difference, b ut presented with raw numbers, they seem very much much intimidating. Florida, at 17. 3% or 18 million is estimated at being make full with 3. 11 million retirees. Thats nearly the population of Oregon. Lets be glad not everyone in oregon is 65 or older, although itd be quite a good investment opportunity for retirement centers.Anyways, with nearly 2 in 10 people being retired, and therefore not bringing in income, Florida is already sounding like one smart cookie of a state. Lets further it buy bringing up some other facts. Florida has an unemployment rate of 11. 5%, or around 2. 1 million people. Between the unemployed and retirees, Florida has over 5. 2 million of its 18 million not bringing in any wages, and therefore not giving the state any income tax. Although Florida has to a greater extent retired people, the average wage of an Oregonian, being 35,500 dollars, is lower than Florida, at 39,000 dollars.Over 2. 5 million people in Florida are also on victuals stamps, which is a state funded program that allows unfortunate people and families to purchase food to prepare. This is another good sign Florida isnt instating an income tax because the taxes collected would surely be directly sent back through programs such as these. This brings forward another point, Florida has a sales tax, or a tax which is imposed on purchasable and rentable goods and physical property, as well as special services.Medications requiring a prescription are also not taxed. Tax is only made on retail sales, for example if you bought something at a store, because sold it to a neighbor, you would not collect sales tax and send it to the government. If you were however, to purchase an item, then sell it back to a retailer, they would sell it and charge sales tax for a second time. Pawn shops and Used car dealerships are great examples a multiple taxed item. The general rate is 6%. As with many states, Florida also has Sales Tax Holidays.What this means is during certain measur e of the year, particular items are priced with discounted tax or no tax at all, although the latter is more rare. such holidays and items would include things similar to school supplies in the days before school starts. With so many people on food stamps, it would be smart to have a sales tax when food stamps are used to purchase food, because usually basic foods such as milk, bread and other groceries arent taxed or are taxed less because they are considered necessities compared to prepared food such as McDonalds or food repared at a restaurant. If they had sales tax, not to mention they were being paid for by food stamps, the government would be recycling money, or basically handing it to the person, which they would then spend and be taxed on, and that is ineffective compared to just taxing goods where people would spend their own income and the government would collect on that rather. This is different than say Oregon, who has no sales tax, except in special cases, such as Ash land which charges 5% prepared food tax. This works for Oregon because they have a instituted income tax, and no sales tax.This way, as long as you make wages, Oregon doesnt premeditation how you spend them, because they have already collected your money Collective tax tax receipts forwards these arguments. altogether forms of taxes resulted in a gross revenue of 5. 76% of a persons income from Oregon. Florida had 5. 03%. Although Florida is lower, given the fact that the population is much larger, much more money was made. Again referencing the income of a Floridian being around 3,500 more dollars, with the added fact of a larger population group, the money could be considered evened out. 5. 03% of a Floridians income would amount to about 1,960 dollars, where Oregons 5. 6% amounts to 2,072 Dollars. So era being different by . 7%, which is a big difference when youre talking about the millions of people and even more money, the issue forth difference only being around 100 dol lars total tax revenue per capita is pretty significant considering the stats weve been shown. With this, we briefly observe labor laws. Until 2004, Florida had no minimum wage law. This means it would have been very hard to implement an income tax. Also could be considered unjust, given the fact that the government could decide how much you must pay of your earned wages whilst not making mandatory to earn a minimum wage of any sort.Once the law was established, however, it was also done so with a receive that it would be adjusted annually based on inflation. Potentially we could see an income tax initiated in the cheer State, but it is unlikely with the current working taxes as they are. Next we can look at a bit of history with the states and taxes. Oregon instituted its first tax in 1844, being a property tax. In 1929, Oregon implemented an income tax, for two main reasons, to spread taxes more equally over residents, and to give some relief to those paying heavy property taxes . On average, Oregon receives over 70% of its tax revenue from income tax.Property tax is still around, and makes about the same amount of money as income tax, but around half of it is given to school systems and public education. Corporate income tax often makes small fractions of what regular does, being in the low hundred millions, compared to a couple billion in income tax. Florida, on the other hand, does not have income tax, rather sales tax as we have talked about. In 1949, Florida implemented its first sales tax. It had a base rate of 3%. This lasted until 1968, when it was bumped up to 4%. This rate remained until 1982, when it was increased again to 5%.And as of February first, 1988, the tax base rate has been 6% of total sale. Farm equipment, however, has held another rate, being 2% from 1963-68, and then being put up to 3% from 1968 to 2001, when it was decreased to 2. 5%, but four years later in 2005 it was decreased to 0% and stands that way today. Florida also has dif ferent tax judge based on counties surcharge tax, for things such as living costs, tourists development, and local administration costs. These differ in time ranges, rates, and longevity. So, is it needfully a good or bad thing for these different states to have separate tax systems and rates in place?Well the answer is, there is no real answer. Different systems work for different people and places, and surely there are always optimizations that could be made, but in reality there is not and will likely never be a perfect tax system. Money require to come from somewhere and taxes are a way to do it, but like I verbalize earlier most people dont enjoy seeing a tax rise, even though it could rationally be deemed necessary. Oregon works with its income tax because it was implemented to counter high property taxes, and sales tax was never made because these two tax systems were already in existence and helping the state well.Income tax again brings in over 70% or the annual tax rev enue for the state of Oregon. Florida finds different success given a different population spread giving them more advantages earning taxes from everyone who spends money compared to everyone who earns money. Given the fact that Florida is often a hot spot for tourists or even world(prenominal) travelers, sales tax proves effective because it earns money from people even just visiting from other states, whereas the extra products sold would result in no additional income otherwise.This makes sense for Florida compared to Oregon, because Oregon would not really considered a tourism state that states like Florida or California may be seen as. Also we take into consideration professional sports teams. Oregon has the Portland Trailblazers, NBA, the Portland Timbers, MLS, and thats about it. Florida however have a multitude of teams, being the NFL troika of Miami Dolphins, Jacksonville Jaguars, and the Tampa Bay Buccaneers, the NBA teams consisting of the Orlando Magic and Miami Heat, the MLB with Miami Marlins and Tampa Bay Rays, and lastly NHL Hockey teams being Florida Panthers and the Tampa Bay Lightning.Given the fact Florida has 9 major league sports teams, you can imagine the sales in tickets, hotels, restaurants, merchandise, and other sports related events. One game debauched 20,000+ attendees depending on the venue can generate millions overnight in the economy in and around the white venue. Granted both Portland teams can do the same but even assuming each right can bring in that type of money, Florida is up 9-to-2 and has a sales tax that can apply to many, many things being purchased around game time.In conclusion, although you cannot say which state is necessarily better in regard to taxes and tax systems, you can easily see that each state has the system it best sees fit to bread and butter the government and economy. Department of Revenue Newsroom History & Statistics about Oregon Taxes. Department of Revenue Newsroom History & Statistics abo ut Oregon Taxes. Web. 08 June 2012. . Florida Department of Revenue. Welcome to the Web Site. Web. 08 June 2012. . History of State and topical anesthetic Taxes. Revenuelaw. state. fl. us. Fl. gov. Web. 7 June 2012. . Florida Department of Revenue. FL Dept Rev. 02 Jan. 2007. Web. 05 June 2012. Sapia, Jason, and Joseph Henchman. Local Income Taxes City- and County-Level Income and Wage Taxes Continue to Wane. Tax Foundation. Taxfoundation. org, 31 Aug. 2011. Web. 05 June 2012. Income Tax. TheFreeDictionary. com. Web. 07 June 2012. State Individual Income Tax Rates, 2000-2012. Tax Foundation. Web. 07 June 2012. . 2012 State Tax Rates & Exemptions. Oregon Income Tax Rates and Tax Brackets, 2011-2012. Web. 07 June 2012. .