Louisiana ranked 40th in a new study by the Tax Foundation, which evaluated how dependent states are on individual income taxes.
State income tax collections in Louisiana total 15.7 percent of all state and local levies collected, based on the most recent data available from fiscal-year 2016.
Nationwide, the average state reliance on individual income tax revenues is 23.5 percent, according to the Tax Foundation’s analysis. Seven states – Alaska, Florida, South Dakota, Wyoming, Nevada, Texas and Washington – levy no state income taxes, while New Hampshire and Tennessee tax only interest and dividend income, not workers’ wages.
Income taxes have a more negative effect on economic growth than sales and property taxes, the Tax Foundation notes, because income taxes rely on wages and savings, whereas consumption taxes fall on consumer spending rather than earnings.
Which States Depend Most on Income Taxes?
Rank | State | Income Tax as a % of State and Local Taxes |
1 | Oregon | 41.7% |
2 | Maryland | 37.8% |
3 | California | 33.8% |
4 | Kentucky | 33.3% |
5 | New York | 32.7% |
6 | Massachusetts | 32.7% |
7 | Minnesota | 31.9% |
8 | Virginia | 31.9% |
9 | North Carolina | 30.3% |
10 | Montana | 29.7% |
11 | Utah | 29.6% |
12 | Connecticut | 29.2% |
13 | Missouri | 28.6% |
14 | Georgia | 27.7% |
15 | Wisconsin | 27.1% |
16 | Pennsylvania | 26.2% |
17 | Delaware | 25.8% |
18 | West Virginia | 25.8% |
19 | Idaho | 25.8% |
20 | Ohio | 25.6% |
21 | Indiana | 25.5% |
22 | Colorado | 25.4% |
23 | Michigan | 24.2% |
24 | Iowa | 23.9% |
25 | Arkansas | 23.5% |
26 | Alabama | 23.2% |
27 | Nebraska | 23.1% |
28 | Hawaii | 22.9% |
29 | South Carolina | 22.7% |
30 | Maine | 22.4% |
31 | New Jersey | 22.2% |
32 | Oklahoma | 22.1% |
33 | Rhode Island | 21% |
34 | Vermont | 19.8% |
35 | Illinois | 19% |
36 | New Mexico | 17.4% |
37 | Kansas | 17.1% |
38 | Mississippi | 16.7% |
39 | Arizona | 16% |
40 | Louisiana | 15.7% |
41 | North Dakota | 7% |
42 | Tennessee | 1.5% |
43 | New Hampshire | 1.4% |
44 (tie) | Washington | 0% |
44 (tie) | Nevada | 0% |
44 (tie) | Alaska | 0% |
44 (tie) | Wyoming | 0% |
44 (tie) | Texas | 0% |
44 (tie) | Florida | 0% |
44 (tie) | South Dakota | 0% |
Source: Tax Foundation
This is a revised article first published by The Center Square.
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