The facts on Massachusetts’ Tax Climate

  • 5.3%
    Individual Income Tax
    Flat Tax
  • 8.0%
    Corporate Income Tax
    Flat Tax
  • 6.25%
    Sales and Excise Taxes
  • $1,873
    Property Taxes

Massachusetts’ Individual Income Tax System 

Massachusetts’ personal income tax system consists of a flat rate of 5.3% on most personal income. This rate ranks 30st highest among states that levy an income tax. Massachusetts’ 2008 state-level individual income tax collections were $1,549  per person, which was the 3rd highest in the nation.

50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita

 

Tax Freedom Day Arrives on April 22 in Massachusetts

Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2012, Massachusetts taxpayers work until April 22 (ranked 8th nationally) to pay their total tax bill. The Tax Freedom Days of neighboring states are: Connecticut, May 5 (ranked 1st nationally); New York, May 1 (ranked 2nd nationally); Vermont, April 19 (ranked 13th nationally); New Hampshire, April 16 (ranked 20th nationally); and Rhode Island, April 15 (ranked 21st nationally).

Massachusetts’ State and Local Tax Burden Slightly Above National Average

Massachusetts’ 2009 state and local tax burden of 10.0% of income is slightly above the national average of 9.8%. Massachusetts’ tax burden has decreased overall from 12.1% (4th nationally) in 1977 to 10.0% (11th nationally) in 2009. Massachusetts taxpayers pay $5,316 per capita in state and local taxes.
Massachusetts’ State and Local Tax Burdens, 1977-Present
Other States’ State/Local Tax Burdens
Map of U.S. Showing all State’s Burdens and Ranks
Historical Chart Comparing All States’ State/Local Tax Burdens from 1977 to 2009

Massachusetts’ 2013 Business Tax Climate Index Ranks 22nd

Massachusetts ranks 22nd in the Tax Foundation’s State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. The ranks of neighboring states are as follows: Rhode Island (46th), Connecticut (40th), New York (50th), New Hampshire (7th), and Vermont (47th).

50-State Comparison of Business Tax Climates (data only)
2013 State Business Tax Climate Index (full study)