By Jared Walczak, includes “Inflation is often called a hidden tax, but in many states it yields a far more literal tax increase as tax brackets fail to adjust for changes in consumer purchasing power. … When tax brackets, the standard deduction, or personal exemptions are not inflation-adjusted, they lose value due to inflation, raising tax burdens in real terms. … For a full accounting of states’ approaches to inflation indexing, along with a discussion of best practices for adding cost-of-living adjustments to state tax codes, see our primer on this topic.”