April 7, 1994
The State and District Impact of the Clinton Tax Increase
by Mitchell, Daniel J.
Backgrounder Update #221
(Archived document, may contain errors)
4/7/% ZZI
THE STATE AND DISTRICT IWACT OF THE CLINTON TAX INCREASE
(Updadng Backgrosm&r Updae No. 2089 'ne States and Districts Hit Hard= by the 1"3 Tax bicrease:'November 24, 1993.) With April 15 just around the corner, many taxpayers are acutely aware tio the tax burden in America is at an all-titne high. This is due in part to President Clinton and Congress, who imposed on the American economy last year the largest tax in== in world history. While no region of the country was spared, the tax hike will have a particularly severe impm on certain states and districts. The state of Cali- fornia, for instance, will lose more thaii $37 billion over the next five years as a result of the new tam included in last year's leg- TEN HARDEST-HIT STATES islation. On a per capita basis, Connecticut is the hardest hiL Revenues Loss Per Capita The $5.8 billion impact of the'Clinton tax hike an Connecticut Arnount of Money equals $1,711 for every man, woman, and child in the state. Taken 6orn State Amazingly, all four U.S. Senators representing these two states voted for the tax bill. STATE my Per Capita The impact on al districts is even more pro- Connecticut $1,710.62 nounced. As detaileeinthe Appendix, 39 congressional districts Newlersey $1,429.09 will lose more than $1 billion apioce over the next: five years than to I= yeWs record tax hike. One district in Now York NewYork $1=.89 City will have more than $3A bdhon udwn out of ns economy Massachusetts $1,183.89 A dis= in southern California comes in second, losing nearly California $1.166.11 $2.8 billion. Surprisingly, the Members of Congress from these Florida $1,154.63 two districts voted in favor of the tax increase. Indeed, of the 39 Illinois $1,149.31 Members representing districts that will lose more than $1 bil- Maryland $1,138-57 lion, fourteen voted in favor of the tax increase. Hawaii. $1,09921 As the tables that follow indicate, no state or district will bene- Nevada $1,093.79 fit from the higher taxes. Thew figures notwithstanding, the Somr. U.S. Tna=ry. U.S. C@- wd White House still maintains that taxpayers come out ahead be- Connadonelludga Office _J cause higher taxes will stimulate economic growth, lower inter- est rates, encourage job creation, and reduce the budget deficit. it appears that none of thew goals win be met. hatted, by condnuing the high-tax policies of the BushWhite House, the current Ad- ministration is largely responsible for the emomy's continued -sub-par performance. Consider. V Economic growth, which historically has increased at an Unn"Al average Of more than five Pff=t the three years following a recession, has been averagirig barely half the levels normally achieved at this stage of a business cycle.
