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Obama tax plan: Which cities would it hit hardest?

President Obama's plan to raise tax rates would hit the wealthiest Americans. Yet cities with the highest percentage of rich households are clustered in blue states.

President Barack Obama speaks at the National Defense University at Fort McNair in Washington, Dec. 3.

Charles Dharapak/AP

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If President Obama gets his way in his desire to raise taxes on the wealthiest, the East and West Coasts will be hit the hardest.

That’s where the richest Americans are clustered. They are in places such as the New York metro area, Silicon Valley, and Boston.

Sorry Dayton, Ohio, (No. 84) and Little Rock, Ark., (No. 64) but you’re not close. Yes, there are some individual ZIP Codes in the Midwest, especially around Chicago, that have high income levels, but the wealth does not extend to the greater metro areas around those rich neighborhoods.

Under the Obama plan – which House Republicans rejected in their own proposal Monday – taxes would rise on people making more than $250,000 a year by returning the top tax rate back to the pre-Bush level of 39.6 percent. This would affect about 3.5 million filers – or the top 2.1 percent, according to the Tax Policy Center, a joint venture of the Brookings Institution and the Urban Institute. For these filers, the average tax increase would be about $34,000, estimates the TPC.

America's wealthiest areas have large concentrations of professionals such as lawyers, government workers, or doctors. It helps to have a university around but it’s not necessary for a metro area to sparkle. Possibly more important is a good commuter transportation system or an area that has a top educational rating. And, for the most part, the rich live in blue states, although the city or town they live in may not have voted with the rest of the state.


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