Where do you think Indiana ranks when it comes to local, state and federal taxes? (Go to the interactive map for the details.) When just state and local taxes are considered, Indiana is 17th at 10.1 percent (of your income), slightly higher than the national average of 10.0 percent. Throw in federal taxes, and our 26.7 percent is slightly below the national average of 27.8 percent, for a ranking of 27th.