Study: Red States Have Most Return on Investment for Their Taxes

A new study on residents’ return on their tax payments finds that red state residents get far more out of their payments in services returned to the people than do residents of blue states.

With taxday coming in only three weeks, the personal finance company Wallet Hub took a look what residents of the states pay in federal plus state taxes and what they get in return.

What they found is probably not surprising to anyone with a brain, but it does tend to show that these liberals states are lying when they claim they are all for the people.

Per Wallet Hub:

Americans have looked at taxes with especially high scrutiny in recent years. In fact, 73% of people think the government doesn’t spend their tax dollars wisely, according to WalletHub’s Taxpayer Survey. We do know, however, that taxpayer return on investment, or ROI, varies based where one lives. Federal income-tax rates are uniform across the nation, yet some states receive far more federal funding than others.

Federal taxes and support are only part of the story, though. Different states have dramatically different tax burdens. This begs the question of whether people in high-tax states receive superior government services. Likewise, are low-tax states more efficient or do they receive low-quality services? In short, where do taxpayers get the most and least bang for their buck?

WalletHub aimed to answer that question by contrasting state and local tax collections with the quality of the services residents receive in each of the 50 states within five categories: Education, Health, Safety, Economy, and Infrastructure & Pollution. Our data set includes a total of 29 key metrics.

So, what were the best ten states for return on investment? It turns out only one was blue and another purple (New Hampshire and Virginia). The rest were red states:

1. New Hampshire
2. Florida
3. Alaska
4. South Dakota
5. Texas
6. Missouri
7. Virginia
8. Georgia
9. Ohio
10. Wyoming

And the worst? Two red states appeared at the bottom (Louisiana, Arkansas) and the rest were solid blue:

41. New York
42. Louisiana
43. Oregon
44. Vermont
45. Connecticut
46. Delaware
47. Arkansas
48. New Mexico
49. Hawaii
50. California

What did Wallet Hub Conclude?

Red States have a higher taxpayer return on investment, with an average ranking of 21.52, compared with 29.48 for Blue States (1 = Best).

Tennessee has the lowest proportion of major roads in poor or mediocre condition, 14.00 percent, which is 5.4 times lower than in Rhode Island, the state with the highest at 75.00 percent.

Maine has the fewest violent crimes per 1,000 residents, 1.09, which is 7.7 times lower than in Alaska, the state with the most at 8.38.

North Dakota has the lowest infant mortality rate per 1,000 live births, 2.77, which is 3.4 times lower than in Mississippi, the state with the highest at 9.30.

One thing Wallet Hub did find, though, is that education is “better” in blue states.

The best for education were Mass., Conn., New Jersey, Virginia, and Maryland — all blue states. The worst were West Virginia, Arizona, Louisiana, Alaska, and New Mexico — with New Mexico being the only reliably blue state in the worst list and Arizona trending purple.

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Tags: Commentary