published Thursday, April 5th, 2012

Tennessee first to 'Tax Freedom Day'

TAX FREEDOM DAY

National Tax Freedom Day, which marks the day average Americans have worked enough to earn the equivalent of their tax bills, falls on April 17 this year. Broken down by state, the dates fall earlier or later.

EARLIEST DATES:

• Tennessee — March 31

• Louisiana — April 1

• Mississippi — April 1

• South Carolina — April 3

• South Dakota — April 4

• Alabama — April 6 (7th earliest)

• Georgia — April 10 (15th earliest)

LATEST DATES:

• Connecticut — May 5

• New Jersey — May 1

• New York — May 1

• Washington — April 24

• Wyoming — April 23

• Illinois — April 23

If Tennesseans worked every day since Jan. 1 and saved every penny, they finally would have earned enough to pay off this year’s tax bill.

It took 91 days, but March 31 marked Tennessee’s “Tax Freedom Day,” the day when the average person’s earnings matched their annual tax bill.

The state was the first to cross the tax day finish line, coming in 17 days ahead of the April 17 national average and 31 days ahead of Connecticut’s May 5 date, the nation’s latest.

“Tennessee as well as neighboring states all have the earliest dates because they have below-average incomes,” said Will McBride, author of the report from The Tax Foundation. “It definitely helps that there is no personal income tax.”

The Tax Foundation is a nonpartisan organization aimed at educating Americans about the country’s tax policy and tax burden. The foundation releases a Tax Freedom Day report every year.

Nationally, the average tax bill accounts for about 29 percent of an individual’s income. In Tennessee, the average burden sits at just below 25 percent.

“It’s indicative that we’ve got a great state, some good leadership and some solid citizens that have elected some good leadership,” said Mark West, president of the Chattanooga Tea Party. “But we’re never convinced that we’re as efficient as we can be in government. There’s probably some places that we could fine tune and improve.”

Federal taxes account for just under two thirds of the total tax burden. For the average American, it took 69 days to pay off federal taxes and only 37 days and four hours to pay off state taxes.

“The biggest tax is the federal personal income tax by far,” McBride said. “We’re sending way too much money to Washington.”

The latest-ever Tax Freedom Day fell on May 1 in 2000, 121 days into the year.

In 2011, Americans will pay a total of $2.62 trillion in federal taxes and $1.42 trillion in state and local taxes, according to the report.

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