Taxes are a common theme on news shows in the U.S.; you may have even seen the Tax Foundation’s very own Kyle Pomerleau speaking about the presidential candidates’ tax plans. However, Americans rarely see a sitcom or...
The facts on Kentucky’s Tax Climate
6%individual income taxTop rate
6%corporate income taxTop rate
$716property taxcollections per capita
Kentucky's Individual Income Tax System
Kentucky's personal income tax system consists of six brackets and a top rate of 6%. That rate ranks 19th highest among states levying an individual income tax. Kentucky's state and local income tax collections per person were $1060 in 2012 which ranked 18th highest nationally.
50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita
Kentucky's Corporate Income Tax System
Kentucky's corporate income tax system consists of three brackets and a top rate of 6%. That rate ranks 19th lowest among states levying a corporate income tax. Kentucky's state and local corporate income tax collections per person were $158 in 2012 which ranked 16th highest nationally.
50-State Table of Corporate Income Tax Rates
50-State Table of State and Local Corporate Income Tax Collections Per Capita
50-State Table of State Corporate Income Tax Collections Per Capita
Kentucky Sales and Excise Taxes
Kentucky levies a 6% general sales or use tax on consumers, which is above the national median of 5.95%. Kentucky's state and local governments collect $698 per person in general sales taxes and $585 per person in excise taxes, for a combined figure of $1283, which ranks 13th lowest nationally. Kentucky's gasoline tax stands at 27.6¢ (23rd highest nationally), while its cigarette tax stands at $0.6 (12th lowest nationally.)
50-State Table of State and Local General and Selective Sales Tax Collections Per Capita
Kentucky Property Tax Collections Relatively Low
Kentucky's state and local governments collected approximately $716 per person in property taxes in 2012, which ranks 5th lowest nationally.
State and local property tax collections per capita by state
Tax Freedom Day Arrives on April 8th in Kentucky
Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2014, Kentucky taxpayers worked until April 8th (7th earliest nationally) to pay their total tax bill. The Tax Freedom Days of neighboring states are: Illinois, April 28th (ranked 7th latest nationally); Indiana, April 16th (ranked 24th latest nationally); Ohio, April 14th (ranked 23rd earliest nationally); West Virginia, April 10th (ranked 9th earliest nationally); Virginia, April 24th (ranked 11th latest nationally); Tennessee, April 5th (ranked 4th earliest nationally); and Missouri, April 11th (ranked 15th earliest nationally).
Kentucky's State and Local Tax Burden In Line with National Average
Kentucky's 2011 tax burden of 9.5% ranks 23rd highest out of 50 states, and is below the national average of 9.8%. Kentucky's taxpayers pay $3169 per capita in state and local taxes.
Kentucky's State-Local Tax Burden, 1977-Present
Other States' State/Local Tax Burdens
Map of U.S. Showing all State's Burdens and Ranks
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2009
Kentucky's 2015 Business Tax Climate Index Ranks 26
Kentucky ranks 26th in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes, individual income taxes, sales taxes, unemployment insurance taxes, and taxes on property, including residential and commercial property. The ranks of neighboring states are as follows: Illinois, 31st, Indiana, 8th, Ohio, 44th, West Virginia, 21st, Virginia, 27th, Tennessee, 15th, and Missouri, 17th.
State Business Tax Climate Index (full study)
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