6 HќќѠіђџȱ юћјђџ ѝџіљ 2014 average U.S. load of $9,366, ranking us 30th highest in the country. Having determined that Indiana has a low corporate tax rate and collection compared to other states, how do we compare in other areas? The report combines tax collec- ȱȱęȱDZ 1. Property taxes in Indiana represent 27.3 percent of total state and local tax collections, while the national average is 33.1 percent. Thus Indiana is a choice place to own a home. 2. Through general sales tax, Indiana collects 27.1 percent of its taxes, compared to the national average of 22.5 ǯȱ ȱȱĴȱȱǰȱ Ȃȱŝȱȱȱ ¡ȱȱȱȱȱęȱȱȱȱȱȱ highest rate in the country. California, at 7.5 percent, ranks alone at the top. Taxes must be collected somewhere; by placing a higher relative burden on sales taxes, we draw help from people outside of Indiana who pay our sales tax. Therefore sales tax is actually a good place to be high in relation to other states. 3. For individual income tax, Indiana relies on taxes collected from individuals — state income taxes — for a rate of 26.8 percent, compared to the national average of 21.3 percent. However this percentage does not factor in the tax reduction for individuals, passed by the 2013 General Assembly, from 3.4 percent down to 3.3 percent for taxable years 2015 and 2016, and then down further to 3.23 percent thereafter. 4. The aforementioned corporate income tax makes up řǯŗȱȱȱ Ȃȱǰȱȱ ȱȱ national average of 3.6 percent. Again that number will continue to decrease during the next several years. This tax needs to be low, because businesses pass along their tax burdens to buyers of their products in the sale price. ¢ȱȱȱ ȱȱ¡ȱǰȱ ȱĴȱȱǰȱ and companies located here can be competitive nationally and internationally. 5. ȱȱęǰȱȱ¢ȱȱȃother taxes,” Indiana is at a level of 15.8 percent, compared with the U.S. average of 19.4 percent. ȱ ǰȱ Ȃȱ¡ȱȱȱȱȱ ȱȱ ȱȱȱȱĴȱȱȱȱȱǯȱ ȱ Ĵȱ ȱȱȱȱ ȱȱȱȱȱȱ capita average income level, which we will need to do for Hoosiers to improve economically compared with the rest of the country. I have only scratched the surface of the information ȱȱȃ ȱǭȱ ǯȄȱ ȱȱȱȱ 55-page report, go to: www.taxfoundation.org. If you, like me, are fascinated by numbers, taxes and economic data, this is a must read! Recently the Tax Foundation, a nonpartisan research think tank founded in 1937, released its annual ¢ȱȱȱ¡ǰȱȃ ȱǭȱ Figures: How Does Your State Compare?” The report provides comparative listings of all the states in a variety of categories. I am pleased to report that Indiana fared well. Tax Freedom Day,® which is the day that the average taxpayer has made enough money to cover all of his or her federal, state and local taxes for that year, came to Indiana on April 13, ranking us 26th best in the country. Compared to Mississippi and Louisiana, which both reached their tax freedom days in late March, ȱȂȱȱǯȱ ȱȱȱ ǰȱ ȱ ¢ȱȱ ȱ ǰȱ ȱ ȱȱȱȱ¡ȱ freedom days until early May, we look very good. Like Indiana, the other 44 states are reaching their tax freedom days sometime in April. Another measure covered in the report is the average ¡ȱȱȱȱȱŘŖŗŘǯȱ ȂȱȱǞřǰřŞśǰȱ ȱȱ highest state, Connecticut, is more than double at $7,150! ȱȱǰȱ Ȃȱȱȱȱȱȱ $59,687, while Indiana ranks 38th at $38,119. So while Connecticut taxes are much higher, at nearly 12 percent ȱȱȱȱ ȂȱŞǯşȱǰȱȱȱ is not as stark as the raw data suggests. The U.S. averages were a total tax burden of $4,217 on income of $43,735, for ȱȱȱşǯŜśȱǯȱ ȱȱ¢ȱĴȱ on both total tax dollars and tax percentage. Turning to business taxes, Indiana is the 10th most business-friendly state in the country, even before taking into account the reductions in corporate and ęȱȱ¡ȱȱȱȱŘŖŗŚȱ General Assembly. The action taken in 2014 will result in a 4.9 percent corporation tax rate in 2021 and a rate of ŚǯşȱȱȱęȱȱȱŘŖŘřǯȱ ȱȱ implementation of these tax reductions in Indiana, and assuming that other states do not likewise reduce their business taxes, Indiana will be the No. 1 business-friendly state in the nation. ȱ ȱȱ ȱȱȱȱĴȱȱȱ ȱȯȱȱȱȱ¢ȱȱ ȱȱȯȱȱȱ Hoosier state. It also should create opportunities for banks operating in Indiana to grow their loan portfolios, as new ȱȱȱȱǯȱ ǰȱȱ ȱȱ banks currently not operating in Indiana to locate some of ȱȱǰȱȱ¢ȱȱǯ Another interesting fact from the Tax Foundation report is that the Indiana state-only debt per capita is $3,449, compared to the U.S. average of $3,678, ranking us 24th highest. State and local debt was at $7,597, compared to the ASSOCIATION UPDATE PRESIDENT’S PONDERINGS 6 -RH 'H+DYHQ 3UHVLGHQW &KLHI ([HFXWLYH 2IÀFHU ,QGLDQD %DQNHUV $VVRFLDWLRQ
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