Once again, Louisiana leads the nation for the highest state and local sales tax rates. Tax Foundation policy analyst Janelle Fritts says Louisiana has the highest average combined state and local sales tax rate at 9.55 percent.
“The local part of that equation is what’s really bringing those rates up, the state rate is pretty comparable with other states, but with the local rates added on, it gets very, very high,” said Fritts.
The average local sales tax rate in Louisiana is 5.1-percent and the statewide sales tax rate is 4.45 percent. New Mexico is the only state to reduce its state sales tax rate in the last five years and Fritts explains why state lawmakers are not willing to reduce sales tax rates.
“These sales taxes are mainly aimed at goods, whereas the economy is really shifting towards services, so states tend to have to bring up those rates in order to bring in the same amount of revenues they’ve had in the past,” said Fritts.
There is some relief in the future. Fritts says a temporary .45-percent state sales tax is set to expire in 2025.
“Which will definitely be good for the state,” said Fritts.
On the flip side, Fritts notes Louisiana has the third lowest property taxes in the country.
Louisiana, Tennessee, Arkansas, Alabama and Oklahoma have the top five combined state and local sales tax rates.
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