Illinois was ranked one of the nation’s worst states for taxes in a new survey released Thursday by financial forecaster Kiplinger.
The survey ranked Illinois as the nation’s ninth-worst state for taxes. Kiplinger’s review included a tenuous forecast for the state’s taxes, despite the fact the state’s income tax dropped to a flat rate of 3.75 percent from 5 percent at the start of 2015.
“The bad news is that taxes on just about everything else in Illinois are high and could go higher as lawmakers grapple with the largest state budget deficit in the U.S.,” Kiplinger said.
Citing numbers from J.P. Morgan Chase, the report claimed the flat tax may not last because total liabilities are exceeding assets by 48 percent and the state needs to raise taxes by 17 percent, cut services by 16 percent or increase worker pension contributions by 400 percent.
According to the report, Illinois has the nation’s second-highest property taxes. Kiplinger found that the property tax on the state’s median home value of $171,900 is $3,952. Additionally. the combined state and local sales tax average is 8.64 percent, but in some municipalities that number is as high as 10 percent.
Additionally, the state’s gas taxes and fees are listed at 34 cents per gallon and qualifying food and prescription and nonprescription drugs are taxed at 1 percent.
In comparison, the most tax-friendly state, Wyoming, has no state income tax and an average state and local sales tax of 5.42 percent.
The full Kiplinger ratings are listed below:
The 10 Most Tax-Friendly States:
7. South Carolina
8. South Dakota
The 10 Least Tax-Friendly States:
4. New York
5. New Jersey
10. Rhode Island