With Tax Day looming and 81 percent of people being more worried about inflation than taxes this year, WalletHub has released its 2023 Taxpayer Survey, as well as its yearly report on the States with the Highest and Lowest Tax Rates, in order to help people better understand this confusing time of year.
Also included is a ‘Q&A’ regarding some tax concerns.
Tax Rates in California (1=Lowest; 25=Avg.):
12th – Overall Effective State and Local Tax Rate
13th – Income Tax
16th – Real-Estate Tax
28th – Vehicle Property Tax
33rd – Sales and Excise Taxes
2023 Taxpayer Survey
A total of 73 percent of people say the government does not spend their tax dollars wisely.
Almost 34 percent of people say not having enough money is their biggest Tax Day fear, followed by making a math mistake (23 percent) and getting audited (22 percent).
Thirty-nine percent of people would move to a different country for a tax-free future, while 37 percent would get an “IRS” tattoo and 23 percent would stop talking for six months.
Nearly half – 49 percent – of people surveyed would do jury duty rather than do their taxes, while 36 percent would talk to their kids about sex and 26 percent would miss a connecting flight.
Seventy-two percent of people think their current tax rate is too high.
WalletHub Q&A
With Analyst Jill Gonzalez
Q: Why do most people think their current tax rate is too high?
A: Around 72 percent of Americans think that their current tax rate is too high, according to a recent WalletHub survey. One major reason for this could be that during this time of high inflation, people’s wallets are already stretched thin, so taxes hit even harder than usual. In fact, 81 percent of people are more worried about inflation than taxes in general. Perhaps people feel that a tax break is necessary to lessen the pressures of inflation. Another reason why people think their current tax rate is too high could be that they feel the benefits they receive from the government do not equal the money subtracted from their income. They may also disagree with how their tax dollars are being used or think they are being used inefficiently.
Why do so many Americans feel the government does not spend their taxes wisely?
There are many reasons why around 73 percent of Americans believe the government does not spend their tax dollars wisely, according to WalletHub’s latest survey, but some of the biggest factors are a disconnect between the amount of taxes we pay and the benefits we receive, a general lack of trust in politicians, and the truthful perception that the private sector is more efficient at investing than the government. When Americans hear about billions of dollars in waste, fraud and abuse, they are even more reluctant to part with their hard-earned money. When that’s the message that’s always in the news, it’s easy for people conclude that the government isn’t spending their tax money wisely.
What should taxpayers be worried about on Tax Day?
The biggest things that Americans fear on Tax Day are not having enough money and making a math mistake. In third place is a fear of getting audited. What people should be most concerned about is having enough money to pay what they owe, as trying to come up with additional funds on short notice is difficult for many people during this time of high inflation. Taxpayers can avoid making math errors by completing their tax return early and reviewing it thoroughly for mistakes before submitting it. They can also take advantage of free tax-prep resources that can help make sure that the math checks out.
