Some states still face tight budgets after years of recession and slow recovery. Increasingly, they are turning to tax hikes to make up for the shortfalls. If you live in one of these states, the taxes will hit you in different places — at the pump, in the store, or on your tax return.
In Connecticut, sales of clothing and shoes under $50 are no longer exempt from the state’s 6.35% sales tax, and sales of yachts and other luxury items will now be taxed at 7.75%, up from 7%. High-income residents will be hit hardest by the tax changes, as the state added two new top income tax brackets and increased the highest rate to 6.9%.
Kansas has increased its sales tax by 0.35 percentage point to 6.5% in an effort to close a $400-million budget gap. Coupled with local sales taxes, Kansas now leapfrogs California to have the eighth-highest sales tax in the U.S., according to the Tax Foundation. Kansas residents also pay more for cigarettes following a 50-cent increase on each pack of 20.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Vermont aims to close a $100-million budget shortfall by lowering the amount millionaires can deduct on income tax returns. The Green Mountain State also raised the cigarette tax by 33-cents a pack and removed an exemption for soft drinks from the 6% sales tax.
Struggling to get enough money from Congress to repair crumbling roads and bridges, many states are turning to gasoline taxes for funding. South Dakota, Utah, Idaho, Iowa and Nebraska are all raising their gas taxes by between 5 cents and 10 cents per gallon. More states are sure to follow in the years ahead.
There are plenty more states where taxes are going up. See if yours is one of them.
-
Aging: The Overlooked Risk FactorSponsored Elder care is a personal and financial vulnerability many people fail to plan for.
-
AI vs the Stock Market: How Did Alphabet, Nike and Industrial Stocks Perform in June?AI is a new tool to help investors analyze data, but can it beat the stock market? Here's how a chatbot's stock picks fared in June.
-
2025 SALT Cap Could Hurt Top 'Hidden Home Cost'Tax Deductions The latest GOP tax bill might make hidden homeowner costs worse for you. Here’s how.
-
No Social Security Tax Cuts in Trump’s 'Big Bill'? What Retirees Need to KnowTax Policy Eliminating taxes on Social Security benefits is missing from President Trump’s proposed tax overhaul. Here’s why and what an alternative offering could mean for retirement taxes.
-
Five Surprising GOP Senate Bill Tax Changes to KnowTax Policy Senate Republicans released proposed tax changes for Trump’s ‘one big, beautiful bill.” Some provisions are already stirring debate.
-
Senate Seeks $6,000 'Bonus' Tax Deduction for Those Age 65 and OlderTax Reform Under Trump’s ‘big bill,’ the Senate Finance Committee has proposed a larger bonus tax deduction for older adults than the House. Will it pass?
-
Don't Miss These Four Tax Breaks for Americans Living Abroad in 2025International Tax U.S. expats can reduce their tax burden by taking advantage of a handful of tax credits and deductions.
-
Summer Backyard Ideas With Added Tax Benefits for 2025Tax Tips Find out how these summer 2025 home projects can help you save on taxes next year.
-
Why Your California Utility Bill Could Increase Under Trump's Tax PlanState Tax Energy bills in the Golden State may shock you if Republican lawmakers in Congress remove certain energy tax credits through Trump's 'big, beautiful bill.'
-
Property Tax Relief Bill in Texas: What to Know for 2025Property Tax Texas residents could get major relief from property taxes in 2025. Here's a breakdown of the tax cuts.
