Taxes in some states have become so bad due to deficits. Is there an end in sight?

Jennifer McClelland | RSS | Wed, Dec 23 2009 | 2 Comments

Most of the states across the country have come to a conclusion: They have to raise taxes to help with the budget deficits.

The five states hit hardest by new taxes as written by SmartMoney are:

1) California – This state has a HUGE deficit. It has gotten so bad in California that they the state is starting to pay for things with IOUs. The state deficit estimate for 2010 is almost $25 billion with the state and local tax burden being 10.5%. Voters in the state voted against sales and income tax increases, and with unemployment there nearing 12% and the worst housing market in the country, anyone could understand their unwillingness to vote FOR higher taxes. One of the things on the table now for the state to start raising some extra tax money? Legalize marijuana…

2) New York – With a state deficit estimate for 2010 at $17.6 billion and the state and local tax burden of 11.7%, this state ranks number two in SmartMoney’s poll. The governor of New York, David Paterson has unsuccessfully tried to pass an 18% tax on soft drinks, however he was able to raise taxes on cigarettes and wine. New Yorkers have the second highest tax burden due to the income tax rate of 7.85% for those earning more than $200K a year.

3) Florida – Florida’s deficit estimate for 2010 is $6 billion and the state and local tax burden is 7.4%. In May, Florida passed next year’s budget and included a $1 per pack increase on cigarettes as well as new and higher fees to renew a driver’s license or register a vehicle. While Florida does have the third lowest tax burden in the nation, the state has been hit hard by decreasing home values and huge budget deficit as a result. The deficit could mean more taxes in the future.

4) Massachusetts – Massachusetts has a state deficit estimate for 2010 of $3 billion and a state and local tax burden of 9.5%. While right now, it is middle of the road when it comes to it’s tax burden ranking (23rd in the nation), it is getting ready for some hefty tax increases. When the budget was passed last week, it included new taxes including a 1.25% increase in the sales tax from 5% to 6.25%. Satellite television subscribers will also be tinged with a 5% tax on satellite services.

5) Nevada – With a deficit of $1.2 billion and a state and local tax burden of 6.6%, it doesn’t seem like Nevada is doing that badly, but it had the same major problem that California did: rapidly decreasing property values. It also had a history of low taxes, there was no personal income tax and it imposed some of the lowest taxes on businesses in the country. It once got the majority of its revenue from tourism, so it wouldn’t have to tax residents as heavily. In Nevada, the sales tax is going up along with hotel taxes. It also has the highest deficit to budget ratio of 32%.

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Tags: tax burden, unemployment, income tax rate

The Pitch – Do you think the economic rally has stalled?

Jennifer McClelland | RSS | Tue, Nov 10 2009 | 1 Comment

Do you think the rally has stalled?

Question:

The stock market really hasn’t moved too much one way or another for a few weeks. Do you think that the economic rally has stalled?

Answer:

I think that it has stalled for now, but that could be due to the poor reports coming out about unemployment. If you look at other factors such as retail sales (which were up for the past month) then the economy is doing a bit better in the way of consumer spending.

I think over the next few months, the rally will continue but it will be more gradual.

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Tags: rally, consumer spending, unemployment

The Job Market is Quite Tough.

Jennifer McClelland | RSS | Sat, Oct 10 2009 | 1 Comment

There are millions out of work right now and there are fewer and fewer jobs available for those who are looking or work. Data that was released by the government on Friday showed that the recession is worse than it has been since the beginning of the recession right now.

It’s only expected to get worse because companies are still not hiring and most have no plans on creating jobs to start hiring.

It is so difficult to be unemployed right now because there are about 6.3 people applying for every one job opening. In comparison, when the recession officially began in 2007, there were only 1.7 workers competing for every one job opening in the united States.

Since the beginning of the decade, the largest amount of people who were competing for one job opening was in July 2003, when 2.8 people were looking for every one job opening.

From the beginning of the recession, employers have cut over 7 million jobs. Even though there are fewer and fewer job cuts with each job and unemployment report, there aren’t any jobs being created. Job creation is essential for the health of the economy.

So, people with jobs are feeling a bit more safe when it comes to their jobs. Job security can be priceless, but for those that were laid off or have found themselves unemployed, it is still quite difficult to find work.

It is, of course, more difficult to find work in some areas than others. Jobs are being created in some areas of the country, but there are other parts of the country that barely have any jobs available and are losing them much faster than they’re making them. The more industrial a town is, particularly in this recession, the more that town or county hurts it seems.

Hopefully, the job market will get a bit better sometime soon.

Source

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Tags: Employment, recession, jobs