Tax Day 2018 has come and gone, but the facts remain consistent. Alabama, while reportedly a state with one of the lowest average tax burdens, has been identified by Tax Foundation as one of the top five states with the highest average combined state and local sales tax rates. Averaging a 9.10 percent, our great state’s tendency to lean heavily on sales taxes are driving consumers to purchase elsewhere and negatively impact our local communities.
It’s important to recognize that while Alabama itself has the second lowest average tax burden in 2018, the hefty local sales taxes soar the state to the top of the heap when it comes to combined burdens. While income tax rates are more obscure to many Americans, retail sales taxes are more transparent upon viewing a consumer receipt at the register. Because the burden is more visible, these aggressive taxes make consumers less likely to purchase items from local businesses and look elsewhere for a deal that puts a smaller dent in their wallet. If we don’t push local and state leadership to promote reasonable taxes, our communities will only suffer. A strong Alabama starts by building strong local economies.