Estimating State and Local Tax Exporting Between 1999 and 2012

Abstract

In fiscal year 2012, state and local governments collected $1.4 trillion in taxes. Using various data sources, this paper presents state-by-state estimates of the amount that each state is able to export of its tax burden to non-residents, including the export effects of federal deductibility. Overall, based on the economic incidence assumptions outlined in this paper, between 12.5 percent and 45 percent of state and local tax collections were ultimately borne by out-of-state residents in FY 2012. This large range is the result of the uncertainty pertaining to the economic incidence of the property tax.