In Fiscal Year (FY) 2013, Nebraska collected $8.6 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average Nebraska taxpayer can afford this level of taxation.
As shown in Chart 1 below, Nebraska’s state and local tax burden (tax collections divided by personal income) was the twenty-fifth lowest in the nation for FY 2013 at 9.9 percent—this is -4 percent below the national average of 10.3 percent. As shown in Chart 2, Nebraska’s tax burden has grown by 57 percent to 9.9 percent in FY 2013 from 6.4 percent in FY 1950.
Nebraska has a fairly high property tax burden (3.6 percent, 15th highest). Yet, the property tax burden is offset by a low all other taxes burden (1.5 percent, 42nd highest).
Of course, the tax burdens for local government can vary just as much as they do among the 50 states. As such, we have also calculated the local government tax burden for every county in Nebraska—this includes every taxing jurisdiction within the geographic county borders whether it is a city, a special district, or county government itself.
The Nebraska counties with the highest local government tax burden include: Arthur County, NE (31.7 percent), Blaine County, NE (17.4 percent), and McPherson County, NE (16.1 percent). The Nebraska counties with the lowest local government tax burden include: Stanton County, NE (2.4 percent), Thurston County, NE (3 percent), and Harlan County, NE (3.2 percent).
J. Scott Moody has over 18 years as a public policy economist with a specialty in tax policy and has over 180 publications. He has worked for numerous national and state-based think tanks such as Federalism In Action, Tax Foundation, Heritage Foundation, and The Maine Heritage Policy Center.