Report: State’s combined tax rate in top 5 in U.S.

Consumers in Washington and four other states pay the nation’s highest combined state and average local tax rates, according to a new study by the Tax Foundation, a nonpartisan research group.

The five states with the highest average combined rates are Tennessee (9.44 percent), Arkansas (9.18 percent), Louisiana (8.89 percent), Washington (8.87 percent), and Oklahoma (8.72 percent), the Tax Foundation found.

Washington’s sales tax rate is currently 6.5 percent and the combined state and local rate can be as high as 9.5 percent, according to taxrates.com.

Washington is one of 38 states that allow local governments to levy sales taxes. Five states, including Oregon, do not have statewide sales taxes although two of those states — Alaska and Montana — allow local sales taxes.

Scott Drenkard, an economist with the Tax Foundation, notes that the sales tax rates should be considered in the context of a state’s overall tax structure. He notes that Washington has no income tax and that Oregon, with no sales tax, has a high income tax rate.