As we know, retailers are greatly impacted by consumers’ disposable and discretionary incomes. Disposable income is all of the money people have available to spend after taxes. Discretionary income goes for extras, such as vacations and going to the movies. BOTH are affected by tax rates.
In December 2017, a massive U.S. tax bill was enacted. Due to its complexity, it has taken experts a while to figure out the “winners” and “losers.” Now, we have more answers.
Tax Law’s Effects by State
“The law lowers the corporate income tax from 35 to 21 percent, and is projected to increase overall after-tax income in every quintile of taxpayers. However, some people aren’t confident the new rates will be beneficial for all. According to WalletHub’s Tax Survey, 69 percent of consumers say that they believe the new tax reform will benefit corporations more than consumers. And 67 percent believe it will favor the rich over the middle class. While the changes to the tax law won’t affect most Americans’ 2018 filings for the 2017 fiscal year, 2019 will be a much different story.“
“Citizens of certain states will benefit more than others, too. In order to find out where taxpayers will get the best breaks, WalletHub compared the 50 states and the District of Columbia based on the state-specific average tax change for low, middle and high-income families. Below you’ll find the full ranking.” As well as a few more tailored charts beneath the table.”