A Comparison of State Tax Rates

See how your state's tax burden compares with other states.

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Do you think your state's tax burden is too high? If so, where can you move with lower taxes? This question is harder to answer than you might think.

Each of the 50 states has its own tax system that is completely separate from the federal tax system administered by the IRS. State taxes can include:

  • income taxes
  • state sales taxes
  • property taxes (imposed at the state level by 36 states)
  • excise taxes--for example, taxes on gasoline, cigarettes, and liquor
  • user fees--for example, fees to camp in state parks or to drive on state highways, and
  • other taxes, such as death and gift taxes, and documentary and stock transfer taxes.

The mix of taxes the states utilize to finance their activities can vary markedly from state to state. For example, seven states don't have income taxes: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming; while five have no state sales taxes: Alaska, Delaware, Montana, New Hampshire, and Oregon.

To determine which states have the highest and lowest taxes you have to look at all of the taxes each state charges. For example, the fact that Washington state has no income tax doesn't necessarily mean it has lower taxes overall than Oregon, which has income tax, but no sales tax.

So how do you tell whether Oregon has lower taxes than Washington? There are various ways to measure state tax burdens. The simplest way is to figure out each state's taxes per capita--that is, divide the total taxes paid by the total number of people. The following chart shows the per capita taxes for each state in 2011:

State Tax Revenue Per Capita,
Fiscal Year 2011

State

Revenue Per Capita

Rank

Ala.

$4,855

37

Alaska

$17,630

1

Ariz.

$4,195

47

Ark.

$5,957

16

Calif.

$5,634

23

Colo.

$4,302

45

Conn.

$6,570

12

Del.

$8,091

5

Fla.

$3,974

48

Ga.

$3,807

50

Hawaii

$7,453

7

Idaho

$4,654

41

Ill.

$4,527

42

Ind.

$4,836

38

Iowa

$5,921

17

Kans.

$5,242

30

Ky.

$5,409

26

La.

$5,908

18

Maine

$6,213

14

Md.

$5,683

21

Mass.

$6,832

9

Mich.

$5,541

24

Minn.

$6,279

13

Miss.

$5,987

15

Mo.

$4,511

43

Mont.

$5,800

20

Nebr.

$5,113

32

Nev.

$3,848

49

N.H.

$4,746

40

N.J.

$5,865

19

N.M.

$7,208

8

N.Y.

$7,660

6

N.C.

$4,773

39

N.D.

$9,838

3

Ohio

$5,371

28

Okla.

$5,347

29

Ore.

$5,400

27

Pa.

$5,459

25

R.I.

$6,788

11

S.C.

$4,893

35

S.D.

$5,028

33

Tenn.

$4,313

44

Tex.

$4,209

46

Utah

$4,947

34

Vt.

$8,988

4

Va.

$4,863

36

Wash.

$5,156

31

W.Va.

$6,818

10

Wis.

$5,636

22

Wyo.

$10,694

2

However, this chart can be deceiving. It shows Alaska and Wyoming as the highest per capital tax states. But most of the tax revenue these states collect comes from severance taxes charged on oil and gas extractors, not taxes imposed on individuals.

A different way to rank state tax burdens is by the percentage of state residents' total income goes to state taxes. As you can see in the following chart, when this is done it becomes clear that Alaska and Wyoming impose very low taxes on individuals--in fact, Alaska is dead last, while Wyoming is 46th lowest.

State and Local Tax Burden as a Percentage of State Income, Fiscal Year 2010

State

Tax Burden

Rank

Ala.

8.2%

43

Alaska

7.0%

50

Ariz.

8.4%

40

Ark.

10.0%

15

Calif.

11.2%

4

Colo.

9.1%

32

Conn.

12.3%

3

Del.

9.2%

31

Fla.

9.3%

27

Ga.

9.0%

33

Hawaii

10.1%

14

Idaho

9.4%

25

Ill.

10.2%

11

Ind.

9.6%

23

Iowa

9.6%

24

Kans.

9.7%

22

Ky.

9.4%

26

La.

7.8%

47

Maine

10.3%

9

Md.

10.2%

12

Mass.

10.4%

8

Mich.

9.8%

18

Minn.

10.8%

7

Miss.

8.7%

37

Mo.

9.0%

34

Mont.

8.6%

38

Nebr.

9.7%

21

Nev.

8.2%

42

N.H.

8.1%

44

N.J.

12.4%

2

N.M.

8.4%

39

N.Y.

12.8%

1

N.C.

9.9%

17

N.D.

8.9%

35

Ohio

9.7%

20

Okla.

8.7%

36

Ore.

10.0%

16

Pa.

10.2%

10

R.I.

10.9%

6

S.C.

8.4%

41

S.D.

7.6%

49

Tenn.

7.7%

48

Tex.

7.9%

45

Utah

9.3%

29

Vt.

10.1%

13

Va.

9.3%

30

Wash.

9.3%

28

W.Va.

9.7%

19

Wis.

11.1%

5

Wyo.

7.8%

46

So which state has lower taxes: Oregon or Washington? Oregon ranks higher than Washington on both charts--good evidence the state tax burden is lower in Washington.

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