Historic and current injustices – both in public policy and in society more broadly – have resulted in vast disparities in income across race and ethnicity in Louisiana. Unfortunately, our tax system plays an active role in worsening these disparities by asking those with the least to contribute the largest share of their income to taxes.
In our regressive tax system, the bottom 80% of taxpayers, or those earning less than $91,500 per year, pay 9.8% of their income in state and local taxes. The richest 20% pay a far lower rate of 7.3%.
These higher tax rates on lower-income households impact communities of color more than white communities. Through our upside-down tax structure, Louisiana makes it more difficult for people and communities of color to build income and wealth over time.