The influential Tax Foundation ranks Louisiana 40th overall in its 2025 State Tax Competitiveness Index.
Previously called the State Business Tax Climate Index, the organization rebranded the listing as the State Tax Competitiveness Index to better reflect what it assesses: states’ overall tax competitiveness, not just the business tax climate.
“Louisiana’s tax code is a national outlier, with one of the most complicated sales tax regimes and a long list of unusual and uncompetitive taxes and tax provisions, like inventory taxes and a capital stock (franchise) tax,” the Tax Foundation writes in the report. “Perhaps most notably, Louisiana is highly unusual in lacking central collections and administration of its sales tax. The state has made progress with an alternative remote sellers regime, but parishes’ and other jurisdictions’ ability to define their own tax bases and to administer the taxes separately from the state imposes high compliance costs.”
The foundation also points to the state’s three-tiered income tax, which is not indexed for inflation, pushing taxpayers into higher tax brackets when nominal income rises.
Here’s the breakdown of Louisiana’s ranking:
- Overall—40th
- Corporate taxes—29th
- Individual income taxes—33rd
- Sales taxes—48th
- Property taxes: 16th
- Unemployment insurance taxes—9th
