Liberals and conservatives agree that Tennessee taxes aren't fair
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- Madeline Faber
- Editorial Intern- Memphis Business Journal
- Email | Twitter
Liberals and conservatives can agree on this issue in Tennessee: taxes aren't fair.
In WalletHub's 2014 Tax Fairness survey, analysts surveyed Americans on what they think makes a fair tax system and compared this representative data with real data on the structure of state and local income taxes and sales and excise taxes.
Tennessee state and local taxes got a low overall ranking of 41. Responses from conservatives came in at No. 37. Liberals gave the state a ranking of No. 44.
Both political leanings reported that a progressive tax structure is the most fair. Surveyed conservatives supported higher taxes on the poor and lower taxes on the rich.
Conservatives said 10.3 percent is a fair tax rate for households making $100,000 annually, while liberals supported 13.2 percent in the same bracket. In households making $15,000 annually, conservatives contended a 5.6 percent tax rate is fair, and liberals said 2.6 percent.
However, the real data on household taxes is the inverse of what liberals and conservatives touted to be fair. As income goes up, the state and local tax burden goes down, with the top 1 percent being taxed 5.5 percent of their income and bottom 20 percent being taxed almost 11 percent.
Out of all states, Tennessee comes in at No. 9 in under-taxing the top 1 percent of income earners. (Tennessee does not have a state income tax.) Instead, Tennessee relies heavily on sales and excise taxes.
According to the report, Tennessee ranked 12 in lowest dependency on property taxes, and ranked 3 in lowest dependence on income taxes. The report found that Tennessee has a high dependency on sales and excise taxes and other taxes, with rankings of 49 and 39, respectively.
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