In recognition of Tax Day 2015, we point you to this op-ed published recently in the Lexington Herald-Leader by University of Louisville economics professor Stephan Gohmann, who also serves as a member of the Bluegrass Institute Board of Scholars.
Because states have different tax codes, each state has its own Tax Freedom Day and this year, Kentucky is the sixth state in the nation to reach this mark.
But while this high ranking looks good for Kentucky, digging a little deeper reveals that it actually indicates poor economic health. According to Tax Foundation analysis, Tax Freedom Days are later in states with higher incomes and higher tax rates.
The tax obligation of the state’s citizens, collectively, is greater when more people are working and when more are bumped into higher tax brackets. Kentucky’s tax rates are pretty much on par with other states, indicating that a weak economy is at the root of its early Tax Freedom Day.
Read the entire op-ed here.