New York residents are paying some of the highest taxes in the nation, ranking second only to California, according to a new study by WalletHub. The report, released ahead of Tax Day, found that New York has the 50th overall effective state and local tax rate, meaning it is the most burdensome in the country.
The Empire State also ranks near the top for specific taxes: 49th in income tax burden and 46th in real estate taxes. However, it falls closer to the middle for sales and excise taxes, coming in at 23rd.
WalletHub’s study arrives at a time when tax burdens are a growing concern for many Americans. According to the accompanying 2025 Taxpayer Survey, 91% of Americans believe tax filing should be free, and nearly one in three would rather serve jury duty than do their taxes. Additionally, 77% of respondents think the wealthy do not pay their fair share in taxes.
Despite these concerns, taxes are not always the main factor in deciding where to live. Dr. David Shock, a professor at Kennesaw State University, noted that while retirees are more likely to consider tax rates when relocating, active workers often prioritize salaries and job opportunities, which tend to be higher in high-tax states like New York.
Some states use tax policy to attract new residents, particularly retirees, by exempting various forms of retirement income. Others, like Georgia, offer significant tax incentives to industries such as film production to stimulate economic growth.
State and local governments must balance tax rates with the quality of services provided, according to Dr. Dagney Faulk of Ball State University. She noted that residents weigh the benefits of public services like education, infrastructure, and recreation against the tax burden when deciding where to live.
One ongoing debate in tax policy is whether individuals should pay taxes based on where they live or where they work. Some states, like Ohio and Kentucky, impose local income taxes on workers in a jurisdiction, arguing that they use public services there. However, such taxes add complexity to the system and may deter people and businesses from moving into those areas, experts say.
As tax season approaches, WalletHub has also provided resources to help taxpayers navigate their obligations, including guidance on avoiding tax scams and what to do if they can’t pay their taxes in full.
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