Washington state has the most regressive tax system in the country, followed by Florida and South Dakota, according to a new report "Who Pays?," from the Institute on Taxation and Economic Policy. The report, a distributional analysis of the tax systems in all 50 states, says virtually every state has a regressive tax system that taxes bottom income households at far higher rates than top income households.

On average, state and local governments tax the bottom 20 percent of households by income at double the overall tax rate of the top 1 percent of households. That's primarily because those governments rely heavily on consumption taxes, such as sales taxes, which weigh more on the poor than the rich. Poor families pay eight times more of their income in these taxes than wealthy families, according to the report, while middle income families pay five times more than the wealthy.

Washington leads the report's "Terrible Ten," states where the bottom 20 percent of households pay up to six times as much of their income in taxes as the top 1 percent. In Washington state, the tax rate on the bottom 20 percent of households by income is 16.9 percent, while the tax rate on the top 1 percent of households is 2.8 percent.

Other states with the most regressive tax systems include:

  • Florida, tax rate on the bottom 20 percent of households, 13.2 percent; rate on the top 1 percent of households, 2.3 percent
  • South Dakota, bottom 20 percent, 11.6 percent; top 1 percent, 2.1 percent
  • Illinois, 13.8 percent; 4.9 percent
  • Texas, 12.6 percent; 3.2 percent
  • Tennessee, 11.2 percent; 2.8 percent
  • Arizona, 12.9 percent; 4.7 percent
  • Pennsylvania, 12 percent; 4.4 percent
  • Indiana, 12.3 percent; 5.4 percent
  • Alabama, 10.2 percent; 3.8 percent