Tax Freedom Day arrived Tuesday in Mississippi -- the first state to reach the milestone for 2016 and one day later in the state than last year.
Tax Freedom Day is reached when taxpayers in a state collectively earned enough money to pay their federal, state and local tax bill for the year. It arrives earliest in Mississippi (April 5), Tennessee (April 6) and Louisiana (April 7), while taxpayers in some northeast states will keep paying toward Tax Freedom Day for a month longer. Connecticut will be the last to reach Tax Freedom Day this year, May 21, more than a week later than New Jersey (May 12) and New York (May 11).
National Tax Freedom Day -- when America collectively earns enough to pay off its tax bill at all levels of government -- falls on April 24, 114 days into the year and nine days after the tax-filing deadline, which this year is April 18.
"Tax Freedom Day gives us a vivid representation of how much federal, state and local tax revenue is collected each year to pay for government goods and services," said Tax Foundation Analyst Scott Greenberg. "Arguments can be made that the tax bill is too high or too low, but in order to have an honest discussion, it's important for taxpayers to understand the cost of government. Tax Freedom Day helps people relate to that cost."
Other findings of the report:
-- Americans will spend more on taxes this year than they will on food, clothing and housing combined.
-- Americans will pay $3.3 trillion in federal taxes and $1.6 trillion in state and local taxes.
-- The nearly $5 trillion total in taxes paid is 31 percent of the nation's income.
-- The latest-ever Tax Freedom Day was May 1, 2000 -- meaning Americans paid 33 percent of their collective incomes toward taxes.
-- A century earlier, in 1900, only 5.9 percent of national income was required to pay the tax bill, and Tax Freedom Day fell January 22.