Summary
Nine states cutting income taxes on January 1, 2025: Indiana, Iowa, Louisiana, Mississippi, Missouri, Nebraska, New Mexico, North Carolina, and West Virginia.
Most reductions occur in Republican-led states, with changes like flat tax rates in Iowa (3.8%) and Louisiana (3%).
Democrat-led New Mexico targets middle- and low-income taxpayers.
Proponents argue these cuts enhance economic competitiveness, while critics warn of potential public service impacts.
Several states plan further reductions in coming years.
I had to explain how the progressive tax bracket works on a per-dollar-earned basis to my 65 year old mother last month. Turns out she had thought the different brackets were the amount paid in taxes on all of the income for the year based on year end totals, which is why she assumed the billionaires were getting hit with 37%+ tax and how it was unfair that poor people paid 10-20% and why she has been advocating and voting for a flat tax. She still isn’t changing her mind about anything but at least she now understands how each dollar is taxed I guess.