Louisiana Ranks Favorably in New Property Tax Analysis

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BATON ROUGE (The Center Square) – A new study of property and vehicle taxes in each state shows Louisiana ranks fourth in the former and 25th for the latter.

WalletHub, a personal finance website, compared property taxes in 50 states and the District of Columbia using data from the U.S. Census Bureau, as well as assumptions based on national auto-sales data to determine vehicle property tax rates.

The analysis showed Louisiana ranked fourth among states for the lowest real estate property tax with an effective tax rate of 0.55%, which translates to $1,187 in taxes on a $217,500 home – the median home value in the U.S. as of 2019.

When applied to the state median home value of $163,100, real estate taxes would total $890, according to WalletHub.

Louisiana was behind only Hawaii at a 0.28% effective real estate tax rate, Alabama (0.41%) and Colorado (0.51%). New Jersey ranked last with an effective rate of 2.49%.

“For real-estate property tax rates, we divided the ‘median real-estate tax payment’ by the ‘median home price’ in each state. We then used the resulting rates to obtain the dollar amount paid as real-estate tax on a house worth $217,500, the median value for a home in the U.S. as of 2019 according to the Census Bureau,” WalletHub reported.

Twenty-four states do not have a vehicle tax, and Louisiana topped the list of those that do at 0.10%, which technically puts the state in 25th place for the lowest rate nationwide. That rates translates to annual taxes of $25 on a vehicle worth $25,000.

“For vehicle property tax rates, we examined data for cities and counties making up at least 50 percent of a given state’s population and extrapolated this to the state level using weighted averages based on population size,” WalletHub reported. “For each state, we assumed all residents own the same vehicle: a Toyota Camry LE four-door sedan – 2021’s highest-selling car – valued at $25,295, as of February 2022.”

Louisiana taxed vehicles at the lowest rate of southern states – with the exception of Florida, Texas and Georgia, which do not tax vehicles – beating out Alabama at 0.69%, North Carolina (1.2%), South Carolina (2.5%) and Mississippi (3.46%), according to the data.

Georgia changed its vehicle taxes in 2013 and now imposes a one-time title ad valorem tax of 3%. Virginia imposes the highest vehicle property tax in the nation at 4.04%, which equates to $1,023 in annual taxes on a $25,000 vehicle.

WalletHub put the figures in a broader nationwide context.

“The average American household spends $2,471 on property taxes for their homes each year, according to the U.S. Census Bureau, and residents of the 27 states with vehicle property taxes shell out another $445,” the website reported. “Considering these figures and the massive amount of debt in America, it should come as no surprise that more than $14 billion in property taxes go unpaid each year, according to the National Tax Lien Association.”

WalletHub noted states controlled by Democrats generally impose higher property taxes than states controlled by Republicans. The overall average rank for Democrat states was 29.27, while the average rank for Republican states was 22.60, according to the site.

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