Is the state income tax really 7% (Minneapolis, Stillwater: school district, to live in, versus)

[Glenfield]

Originally Posted by golfgal

Property taxes in SD, and even more specifically Sioux Falls are triple or more what they are here so for the upper middle class and lower, it's a wash for what you pay in taxes there compared to paying property tax and income tax here.

Could you provide a link to this data or is it anecdotal? Thanks.

[xandrex]

Minnesota has always been a state that has higher-than-average tax rates when it comes to income tax, but I think, as many have pointed out, that number is misleading.

Most states make up that money in other ways. Sure, you can go to a state where they don't have income tax (Florida, for instance), but find other ways such as sale tax or property tax to make up that difference. I know that Florida has used the tourists who flock there as a source of revenue.

Another thing that might contribute to our higher income tax rate has actually come up, but in a different context: schools.

It's not just that Minnesota schools tend to be of high quality. But from what I've always understood, the Minnesota Miracle completely revised the property tax structure to shift funding for schools from primarily a local function to a state-wide function (to help with disparities). The link I provided is pretty scant for information, but it's the best I could find at the moment. If indeed I am remembering correctly, that would be a reason that Minnesota also has a higher property tax: schools get more state than local funding than most schools (at least that used to be the case, though apparently the tax structure changed again in 2002).

[golfgal]

Originally Posted by Glenfield

Could you provide a link to this data or is it anecdotal? Thanks.

Look up any real estate site and see what the taxes for a house are in MN vs the same value house in Sioux Falls. When we lived in SF our taxes were $2300/year...on a $60,000 house. You can do the math on other things like license plate fees, sales tax (clothing is taxed there), etc.

[Glenfield]

Originally Posted by golfgal

Look up any real estate site and see what the taxes for a house are in MN vs the same value house in Sioux Falls. When we lived in SF our taxes were $2300/year...on a $60,000 house. You can do the math on other things like license plate fees, sales tax (clothing is taxed there), etc.

Thanks. I thought there might be some website or something where someone had made these comparisons and laid the data out. I thought it would interesting to look at.

[barney_rubble]

The Tax Foundation data (http://taxfoundation.org/taxdata/topic/86.html - broken link) I presented earlier includes all taxes:

State-local tax burdens measure the percentage of income that taxpayers in each state pay in state and local taxes. Every tax that is collected on both the state and local level is included in the calculation: income taxes on individuals and businesses; general sales taxes; product specific taxes such as those levied on gas, cigarettes and alcohol; property taxes on individuals and business; and a multitude of other taxes. The tax burden for each state is presented from 1970 to the present.

Now, it's true that some taxpayers will deviate from this. For example, a family with relatively small income but a relatively large home will find property taxes disproportionately painful.

[cinnamon_toast]

Originally Posted by MSMCGirl

Okaaaaay..... I disagree. Perhaps if CA had HIGHER taxes they'd be able to hire more teachers to deal with a bilingual society in schools (which IS the problem...NOT the "burden" of immigrants themselves but rather their lack of English skills).

School funding is linked to property tax, not income tax. So your 7% tax is not related to the successful school system in MN. Sorry. MN schools are good, I will give you that. I was pleased when my kids attended. But part of the reason MN schools look so good (on paper at least) is demographic. MN by and large has a fairly easy student population to teach in comparison to other states like TX, CA, AZ, FL. And just to set the record straight, there ARE bilingual teachers here in Texas, lots of them! MORE is not the answer. Come spend some time in a school with a high percentage of non-English speakers and low income students. You will quickly see that language is only a small part of the issue.

[Kamsack]

Originally Posted by golfgal

Look up any real estate site and see what the taxes for a house are in MN vs the same value house in Sioux Falls. When we lived in SF our taxes were $2300/year...on a $60,000 house. You can do the math on other things like license plate fees, sales tax (clothing is taxed there), etc.

About property tax differences between North Dakota and Minnesota....

I live in East Grand Forks MN now but lived in Grand Forks ND also.

Current comparisons on an assessed 200,000 house

ND prop tax (most cities are 2.0 to 2.5 pct of assessed value)...
Grand Forks...would pay approx 4100 (using GF tax of 2.1 pct)
East Grand Forks....would pay approx 2300

These amounts do not include any special assessments.

Now...ND income tax is around 3.5 pct

[MSMCGirl]

Originally Posted by cinnamon_toast

School funding is linked to property tax, not income tax. So your 7% tax is not related to the successful school system in MN. Sorry.

I was speaking generally in terms of higher taxes (as that is how the discussion evolved).

Originally Posted by cinnamon_toast

Come spend some time in a school with a high percentage of non-English speakers and low income students. You will quickly see that language is only a small part of the issue

Thank you for the invite!! However, I grew up in the L.A. Unified School District and my jr high and high school were in the BARRIO. I have friends that still teach in the area where it's highly non-English speaking. If you think that MORE money (which will have to come from taxes) won't help hire more teachers and improve conditions then I have a swamp in Texas to sell you too!

[golfgal]

Originally Posted by cinnamon_toast

School funding is linked to property tax, not income tax. So your 7% tax is not related to the successful school system in MN. Sorry. MN schools are good, I will give you that. I was pleased when my kids attended. But part of the reason MN schools look so good (on paper at least) is demographic. MN by and large has a fairly easy student population to teach in comparison to other states like TX, CA, AZ, FL. And just to set the record straight, there ARE bilingual teachers here in Texas, lots of them! MORE is not the answer. Come spend some time in a school with a high percentage of non-English speakers and low income students. You will quickly see that language is only a small part of the issue.

Or maybe that MN has easier students because the schools are so good.

Not all school funding comes through property taxes but being that we have more tax dollars coming into the state that allows income taxes to go for other services leaving property taxes to fund the majority of school costs-it's a good thing. States like South Dakota with no income tax are forced to divide up the property tax dollars to cover everything and given that education usually takes a back seat in most states, not enough is allocated to the schools there-thus their 48th rank or so.

[barney_rubble]

Funding definitely helps, but MN schools obviously have something else going for them because per-student funding is #17 in the nation while school performance is usually ranked higher.

@golfgal: What is the source for your claim that South Dakota schools are poor quality? That is not at all supported by NAEP data.