Today, the Utah Foundation released a report showing that Utah’s overall tax burden and the property tax burden hit record lows over the last five years while the income tax burden hit a record high.
Highlights of the report:
- Utahns’ 2021 overall tax burden was up from 2016 when it was $104.50 per $1,000 of personal income – the lowest tax burden in at least 60 years.
- Utahns’ property tax burden in 2021 was $22.76 per $1,000 of personal income – the lowest property tax burden in the past 100 years.
- Utahns’ personal income rose the fastest of any state from 2016 to 2021. Utahns’ tax burden also rose over the same time period meaning the tax collections increased even faster than the residents’ record personal income growth
Commentary:
During an online discussion of the new report’s findings, attendees heard from Utah Foundation staff as well as:
- Tax Commissioner John Valentine.
- Billy Hesterman from Holland & Hart and former VP at the Utah Taxpayers Association and former Daily Herald reporter.
The report’s author, Utah Foundation Senior Analyst Christopher Collard, notes that, “Much of Utah’s long-term decrease in overall tax burden is attributable to higher levels of per capita personal income and population growth. As incomes increase, Utahns are better off financially and have more discretionary income. However, a falling burden related to population growth may result in budgetary shortfalls and an inability to fully support services.”
The Commissioner said that “it will be very interesting to see what happens in 2022 and 2023 due to a market shift toward residential real estate, the shift to locally assess taxes, the freeze on the school levy, the share of municipalities that raised taxes under truth-in-taxation, and the counties that increased taxes dramatically to catch up after a pause.” These might shift up the burden for Utahns. Contact the Commissioner at [email protected].
Billy Hesterman said that the decrease in property tax burden over the years “goes to show that truth-in-taxation has been serving its purpose in keeping taxes low.” He did add that “it should be noted that this is increasing the pressure on sales and income taxes.” Contact Mr. Hesterman at [email protected] or 801-633-3663.
Utah Foundation President Shawn Teigen says that “People are often surprised that our taxes have trended lower over the long term. However, the small annual changes to our tax bills are not as noticeable as the perennial call for lowering taxes from many elected officials.”
Other report highlights include:
- Utahns’ individual income tax burden has decreased slightly from 2018, when it was at the highest point since the creation of the tax in 1931.
- Utahns’ overall tax burden in 2021 was $109.92 per $1,000 of personal income – slightly below the 10-year average.
