9.45%: Third highest combined sales tax rate in the nation

Why is California's sales tax lower?

Thomas Perumean
August 20, 2019 - 9:03 am

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Louisiana has the third highest combined sales tax rate in the nation at an average of 9.45%.  California's is 8.66%.  Why?

We asked Robert Travis Scott, President of the Public Affairs Research Council.  "Sales tax is a big burden in Louisiana," he says.  "We don't have bragging rights going from first to third."

That's right, Louisiana's combined sales tax was the nation's highest at 10%.  That's when the state tax rate was 5%.  It's now 4.45%.  Local sales tax rates vary.  Figuring in the state tax rate, in Jefferson Parish it's 9.25%  Orleans Parish is 9.45%.  Cameron Parish has no local sales tax, so its just 4.45%.  By contrast, East Carrollton Parish is the leader at 11.45%

Scott says parish governments primarily raise revenue by collection of sales taxes.  Scott says depending on sales taxes can be problematic for them:  "Sales taxes tend to be more volitile, when you hit a recession.  Property taxes tend to be more stable over time."  

Scott says low income earners bear the brunt of local sales rates having to pay more for taxed goods.  The silver lining is essentials, like groceries, prescriptions and residential utilities are not subject to local sales taxes.  After that, everything else is taxed at the combined rate.    

By contrast, California's state sales tax rate is 7.25%--much higher than our 4.45%, but the local sales tax rates average out at 1.41% because counties bring in revenue on property taxes.  
 

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