October 26, 2009
Chattanooga Times Free Press Quotes Staff Economist Kail Padgitt on State and Local Sales Tax Report
"Tennessee has highest sales tax rate in U.S."
By Dave Flessner
Shoppers in Tennessee pay the highest sales tax rate in the nation, the Tax Foundation said Friday.
The nonpartisan study group said the combined state and local sales tax adds an average 9.4 cents for every $1 spent by consumers in Tennessee, or nearly 38 percent more than the median sales tax nationwide. By comparison, the combined state and local sales tax rate averaged just over 7 percent in Georgia and 6.15 percent in Alabama.
Although some localities in central Alabama have higher combined rates of up to 11 percent, Tennessee averaged the highest rate among all 50 states. The Tax Foundation said Tennessee derives nearly 57 percent of its tax revenue from sales taxes -- the third highest among the 50 states. ...
Nonetheless, Dr. Kail Padgitt, staff economist for the Tax Foundation and author of the study comparing local sales tax rates, said a growing number of states are raising so-called "millionaire taxes" on the income of the wealthiest taxpayers and so-called "sin taxes" that raise sales taxes on cigarettes or beer.
"We definitely seeing more movement upward than downward in taxes on the state level, and the most popular seem to be to target particular types of tax groups," he said.
