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The Time is NOW for a State Top-Down Review

February 15, 2009

* The largest employer in Delaware is government

*  Delaware is 9th in the country for state taxes compounded per capita.

 * Delaware ranks 5th  in Per-capita state and local  education  spending

 *  Delaware’s Individual Income Tax System

Delaware’s personal income tax system consists of six brackets and a top rate of 5.95% kicking in at an income level of $60,000. That top rate ranks 27th highest among states levying an individual income tax. In 2005, individual income tax collections were $1,108 per person, which ranked 9th highest nationally.


* Delaware’s Corporate Income Collections Per Capita Fourth Highest Nationally

Delaware’s corporate tax structure consists of a flat rate of 8.7% on all corporate income. Among states levying corporate income taxes, Delaware’s rate ranks 12th highest. In 2006, state-level corporate tax collections (excluding local taxes) were $346.32 per capita, ranking 3rd highest among states that tax corporate income.


* Federal Tax Burdens and Expenditures: Delaware is a Donor State

Delaware taxpayers receive significantly less federal funding per dollar of federal tax paid than the average state. Per dollar of federal tax collected in 2005, Delaware citizens received approximately $0.77 in the way of federal spending. This ranks the state 7th lowest nationally, even lower than in 1995 when Delaware received $0.85 per dollar of taxes in federal spending and ranked 9th lowest. Neighboring states and the amount of federal spending they received per dollar of federal taxes paid were: Pennsylvania ($1.07), New Jersey ($0.61), and Maryland ($1.30).

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