Have you ever wondered which states have the least imposing taxes? We’ve picked 10 states that stand out for their incredibly low tax rates—some of our states don’t even have taxes! When determining our top 10, we took three factors into consideration: state income tax, state sales tax, and property tax per capita.
1. Indiana
Can these rates get any better? Believe it or not, they will. Indiana plans to lower their sales tax from 7% to 4.9% by 2021. Their income tax is slated to decrease even earlier; by 2017, it should be lowered from 3.4% to 3.23%.
2. Utah
Utah is among the 20 states with the lowest income taxes and is the 13th lowest in terms of property tax per capita. Their sales tax is 5.95%, the national median state tax. Pair that with the average local tax of 0.93%, and you’re at 6.88%
3. Florida
The Sunshine State has no state income tax and a state sales tax that’s slightly above the national median of 5.95%. With its flat corporate tax of 5.5%, Florida is very friendly to corporations.
4. Texas
We threw Texas on our list because it doesn’t impose a state income tax. The Lone Star state loses points because of its higher-than-average state sales tax and a property tax that doesn’t stand out on our list.
5. Nevada
It helps to have an influx of income from casinos and Nevada knows how to capitalize on their tourism industry. Residents benefit from a nonexistent income tax, but they have one of the higher sales taxes on our list.
6. South Dakota
With a relatively low state sales tax and a 0% income tax, South Dakota ranks fairly well on our list. The state brings in $1,216 in income taxes per capita, which places it snugly in the middle of the other 49 states.
7. Wyoming
Wyoming’s state income and sales tax situation mirrors Utah’s. Unlike Utah, however, Wyoming has the fifth highest property tax per capita.
8. New Hampshire
New Hampshire stands out among our list due to its unusual income tax policy. Take-home income isn’t subject to an income tax. However, interest earnings and dividends will be taxed at a rate of 5%. To top it off, New Hampshire has the highest property tax per capita on our list.
9. Alaska
No income tax or state sales tax? That sounds too good to be true. And unfortunately, it is; Alaska ranks eighth among the nation in collected income taxes, and although there is no state income tax, local governments might impose one of their own.
10. Montana
Montana may have no sales tax, but the state has an income tax rate of nearly 7% — the highest on our list. When it comes to property taxes, Montana claims the title of 18th highest in the nation.
