The Tax Foundation identifies “Tax Freedom Day®” as the day “when the nation as a whole has earned enough money to pay its total tax bill for the year.” It combines all federal, state, and local taxes and divides them by the nation’s income.
The Foundation reports that Americans will pay $3.3 trillion in federal taxes and $1.6 trillion in state and local taxes, totaling nearly $5.0 trillion, or 31 percent of the nation’s income– more than Americans will spend on food, clothing, and housing combined.
In 2016, the Foundation reports:
“Americans will pay $3.34 trillion in federal taxes and $1.64 trillion in state and local taxes, for a total tax bill of $4.99 trillion, or 31 percent of national income. This year, Tax Freedom Day falls on April 24th, or 114 days into the year (excluding Leap Day).
“This year, Americans will work the longest to pay federal, state, and local individual income taxes (46 days). Payroll taxes will take 26 days to pay, followed by sales and excise taxes (15 days), corporate income taxes (nine days), and property taxes (11 days). The remaining seven days are spent paying estate and inheritance taxes, customs duties, and other taxes.”
Almost five trillion is paid to federal, state, and local governments, yet America is $16.432 trillion in debt. And, presidential candidate Sen. Bernard Sanders wants to increase taxes even more.
The combination of higher-income and higher-tax states cause Tax Freedom Day to fall later in states like, Connecticut (May 21), New Jersey (May 12), and New York (May 11). Mississippi has the lowest average tax burden in 2016 (April 5); also early are Tennessee (April 6) and Louisiana (April 7).