Today Louisianans Have Finally Earned Enough Money to Foot Their Tax Bill
Today – April 7th – Louisiana celebrates Tax Freedom Day, according to a new report by the Tax Foundation.
Tax Freedom Day falls on the day that Americans as a whole have finally earned enough money to pay off the nation’s tax burden for the year.
It is important to note that the burden borne by taxpayers differs in each state due to the progressivity of the federal tax system and varying state tax policies. A combination of higher-income and higher-tax states celebrate Tax Freedom Day later in the year.
Louisiana is the third state to celebrate Tax Freedom Day 2016, but keep in mind Louisiana’s median annual household income is only 48th highest in the nation, District of Columbia included.
A handful of Louisiana’s neighboring states celebrate Tax Freedom Day relatively early as well:
- Mississippi’s was April 5th, earliest in the nation
- Tennessee’s was April 6th, second in the nation
- Alabama’s is April 8th, fourth in the nation
- Oklahoma’s is April 11th, eighth in the nation
- Arkansas’s is April 13th, twelfth in the nation
National Tax Freedom Day does not arrive until April 24th. Excluding Leap Day, this is 114 days into the year. This date does not account for annual federal borrowing – future taxes owed – which would tack on an additional 16 days – May 10th – before Americans could celebrate Tax Freedom Day.
This year, federal borrowing excluded, Americans will pay $3.3 trillion in federal taxes and $1.6 trillion in state and local taxes for a whopping $4.9 trillion in total taxes. This is 31 percent of the national income.
Breaking it down, it takes Americans 46 days to earn enough to pay federal, state and local individual income taxes, 26 days for payroll taxes, 15 days for sales and excise taxes, 11 days for property taxes, 9 days for corporate income taxes and 7 days for estate, inheritance, customs duties and other taxes.
All in all, Americans will spend more on taxes than they will on food, housing and clothing combined.