Taxes State Taxes Where You'll Pay the Most in State and Local Taxes By Tonya Moreno, CPA Tonya Moreno, CPA Tonya Moreno is a licensed CPA with about 15 years of diversified accounting, tax, and management experience. She is an expert in the field who has worked as a tax accountant for many large, multi-state corporations. She not only has experience in preparing state and federal tax returns, but has also dealt with complex tax issues with large amounts of money at stake. Today, Tonya serves as the chief financial officer of Maslonka Powerline Services in Spokane, Washington. learn about our editorial policies Updated on November 30, 2022 Reviewed by David Kindness Reviewed by David Kindness David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, corporate and individual tax planning and preparation, and investing and retirement planning. David has helped thousands of clients improve their accounting and financial systems, create budgets, and minimize their taxes. learn about our financial review board Fact checked by Mrinalini Krishna Fact checked by Mrinalini Krishna Twitter Mrinalini is the senior investing editor at The Balance and is an expert in investing, financial journalism, digital media, and more. She's been a journalist for more than 10 years at organizations such as the Financial Times and Investopedia, and she has a master's in business and economic reporting from New York University. learn about our editorial policies In This Article View All In This Article State Sales Taxes State Income Taxes Property Tax Rates Putting It All Together Other Things to Think About Photo: Fizkes / Getty Images Some states have high sales taxes and property taxes but no income taxes. Other states have no sales taxes but high income taxes. Overall, taxes at the state and local levels can dramatically impact the cost of living for consumers. These lists of state taxes can give you an idea of how the highest- and lowest-taxed states rank. Find out where your state stands, and check into those you might be considering moving to for one reason or another, like when it's time to retire. State Sales Taxes Sales taxes are the percentage you pay over and above sales prices when you purchase certain items. Most states rely heavily on these taxes to meet their fiscal needs. Municipalities and counties sometimes have their own sales taxes in addition to those charged at the state level. The Tax Foundation, a leading source for tax information, provides comprehensive annual rankings based on various taxes overall. According to the Tax Foundation, the five states with the highest combined sales taxes at the state and local levels as of 2022 are as follows: Tennessee: 9.55%Louisiana: 9.55%Arkansas: 9.47%Washington: 9.29%Alabama: 9.24% The states with the lowest combined sales taxes are as follows: Alaska: 1.76%Hawaii: 4.44%Wyoming: 5.22%Wisconsin: 5.43%Maine: 5.50% Four states have no sales tax at all: Delaware, Montana, New Hampshire, and Oregon. State Income Taxes Seven states impose no tax on residents' incomes as of 2022: Alaska, Florida, Nevada, South Dakota, Texas, Tennessee, and Wyoming. New Hampshire taxes only interest and dividend income, while Washington taxes only high earners, and then only capital gains income. At the other end of the scale are states with walloping tax rates at the highest income levels. The top five states by income tax rate in 2022 are as follows: California: up to 13.3%Hawaii: up to 11%New York: 10.9%New Jersey: 10.75%Washington D.C.: 10.75% You'll note that none of these states also make the list for the highest state and local sales taxes, so residents do receive a little bit of a break there. The bottom states by income tax rate in 2022 are as follows: North Dakota: 2.9% and lowerPennsylvania: 3.07% (flat)Indiana: 3.23% (flat)Ohio: 3.99% and lowerMichigan: 4.25% and lowerLouisiana: 4.25% and lower Property Tax Rates Property taxes are generally imposed at the local level. New Jersey municipalities are known for having the highest property taxes at a median rate of 1.89% as of 2021, and Louisiana has the lowest at 0.18%. Half of all property taxes are higher than the median, and half are lower. Trailing New Jersey but still making the top five states for the most burdensome property taxes are as follows: New Hampshire: 1.86%Texas: 1.81%Nebraska: 1.76%Wisconsin: 1.76% At the other end of the spectrum, the four states joining Louisiana for the five lowest median property tax rates are as follows: Hawaii: 0.26%Alabama: 0.33%Delaware: 0.43%West Virginia: 0.49% Notably, Alabama offsets its ranking here with its high sales taxes. Also note that Washington, D.C., though not a state, falls near the bottom of the list with a 0.46% property tax rate. Putting It All Together These lists only report the highest and lowest states in each category. Consumers will find that the majority of states charge income taxes along with hefty additional state and local taxes. Looking at each of these categories comprehensively for your individual situation can keep you informed regarding your own goals, and it might greatly help to potentially influence your choice of the state in which you want to live, particularly in retirement. Note Property taxes wouldn't be a consideration if you plan to rent rather than own your home, while income tax—or the lack of one—would be more of a consideration for high-income earners. Other Things to Think About Combined taxes are tracked by the U.S. Census Bureau, which generally looks at taxes as a percentage of revenue. As of the third quarter of 2021, combined tax revenues for property, sales and gross receipts, and income taxes amounted to $452.4 billion across the U.S. Each state has a unique mix of taxes that affects both residents and non-residents. This makes creating a comprehensive ranking of overall tax burdens an even more difficult undertaking and one that can be looked at in several ways. The U.S. Census Bureau’s quarterly data report helps provide insight on total tax revenue, which takes into account taxes paid by residents and nonresidents. It can be important to consider taxes as they contribute to state revenue and budgets as well as those that affect local consumers. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. Tax Foundation. "State and Local Sales Tax Rates, 2022." The Tax Foundation. "State Individual Income Tax Rates and Brackets for 2022." Tax-Rates.org. "Property Taxes by State." U.S. Census Bureau. "Quarterly Summary of State and Local Government Tax Revenue for Third Quarter 2021."