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Coming to 25 states: higher taxes

And more states may follow, as officials try to balance budgets in the midst of an economic slump.

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More than half of US states are responding to budget challenges with an answer that's often unpopular with their residents: tax hikes.

In some cases, the levies are modest. Still, six states are increasing personal income taxes, 11 are raising sales taxes, and eight are boosting rates paid by businesses.

The wide geographic scope of the tax increases is an indicator of how much pressure an economic slump has put on state finances. And many of the states are ones that avoided significant tax boosts earlier this decade, the last time the United States was in recession. These include Florida, Minnesota, Wisconsin, Colorado, and Idaho.

In all, 25 states have moved to raise taxes so far this year. Another 12 are considering such moves as they launch into a new budget year this week, according to the Center for Budget and Policy Priorities, a Washington research group that has tracked all the measures.

Given the weak state of the economy, the tally may continue to rise as the year goes on, budget analysts say. That's the case even though states are also cutting spending – at a 4.6 percent pace last year, which was faster than at any time since 1983. States are also getting a big inflow of federal aid from the economic stimulus plan passed earlier this year.

Often, the tax proposals are politically rancorous.


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