When assessing the overall tax burden across U.S. states, several factors are considered to provide a comprehensive ranking. The overall tax burden typically includes state and local taxes, which are further broken down into individual income taxes, property taxes, sales taxes, and excise taxes. This ranking offers valuable insights into how much residents are taxed in relation to their income, revealing the relative affordability of living in each state.
To determine the rankings, the analysis considers both the percentage of personal income that goes to taxes and the absolute dollar amount. Additionally, the variation in tax policies across states, such as the presence or absence of state income tax or specific tax incentives, plays a crucial role in shaping the overall tax burden. This guide provides a state-by-state comparison, highlighting where taxpayers bear the heaviest and lightest tax loads in the U.S.
Finding the best states to retire based on taxes is complicated in that there are a lot of taxes and a lot of exceptions. In order to find the based states based on taxes we needed to look at all of these. Some of the best states for sales tax may not be the best states based on income tax. Some the best states based on income tax may have a high median property tax.
When it comes to property tax we are looking at the median as the property tax rates vary from county to county, town to town. This means you may be able to find a town with reasonable property tax rates in a state with high median property tax rates. Some of the best states for property taxes may have a separate school tax where others find schools through property taxes.
Our list on the best states to retire in based on taxes calculates a rank based on a combination of these taxes. Your lifestyle may have a larger impact. If you don't drive, gas tax would not be a factor. If your retirement income will be lower and you will be spending less, than the cost of living in a state would be more important than the state being the best state based on taxes. We have a separate article that ranks states on cost of living.
1 Wyoming
Wyoming is consistently ranked among the states with the lowest overall tax burden in the United States. This is primarily due to the absence of a state income tax, which significantly reduces the tax load on residents. Additionally, Wyoming benefits from relatively low property taxes and no state-level excise taxes, further enhancing its tax-friendly environment.
When compared to other states, Wyoming's tax burden is among the lightest, making it an attractive option for individuals and businesses seeking to minimize tax expenses. The state’s reliance on revenues from natural resources, particularly energy production, allows it to maintain low tax rates while still funding public services. As a result, Wyoming stands out as a fiscally favorable state, especially when contrasted with states that have higher income and property taxes.
2 Alaska
Alaska is unique among U.S. states in terms of its overall tax burden, as it consistently ranks among the lowest. The state does not impose a personal income tax or a statewide sales tax, which significantly reduces the tax burden on its residents. Instead, Alaska relies heavily on revenues from oil and natural gas production, which allows the state to maintain low taxes while providing various public services.
Compared to other states, Alaska's tax burden is exceptionally low. The absence of major taxes like income and sales tax places Alaska among the states with the lightest tax load on its residents. This low tax environment is one of the factors that makes Alaska an attractive option for individuals seeking to minimize their tax liabilities.
South Dakota is known for its favorable tax environment, ranking among the states with the lowest overall tax burden in the U.S. One of the most significant advantages for residents is the absence of a state income tax, which dramatically reduces the tax burden compared to states with high income tax rates. South Dakota also benefits from relatively low property taxes and sales taxes, further contributing to its ranking as a low-tax state.
When compared to other states, South Dakota consistently stands out as one of the most tax-friendly, making it an attractive location for both individuals and businesses seeking to minimize their tax liabilities. The state's tax policies emphasize simplicity and efficiency, which, combined with the lack of income tax, places South Dakota among the top states for overall tax burden.
4 Florida
Florida is known for its relatively low overall tax burden, ranking among the more tax-friendly states in the U.S. The state does not impose a personal income tax, which significantly reduces the tax load for residents compared to states that do. Florida's tax system primarily relies on sales taxes and property taxes to generate revenue.
The state's sales tax is slightly above the national average, but this is offset by the absence of an income tax. Property taxes in Florida are also close to the national average, though they can vary widely depending on the county.
Overall, Florida’s tax burden is considered moderate to low, making it an attractive destination for individuals and retirees looking to minimize their tax liabilities. When compared to other states, Florida offers a competitive tax environment, particularly for those with higher incomes, who benefit most from the absence of a state income tax.
Tennessee is known for having one of the lowest overall tax burdens in the United States. The state does not levy a personal income tax on wages and salaries, which significantly reduces the tax burden for residents compared to many other states. Instead, Tennessee relies heavily on sales taxes and excise taxes, with one of the highest sales tax rates in the country. Property taxes in Tennessee are also relatively low compared to the national average.
When compared to other states, Tennessee consistently ranks among the states with the lowest overall tax burdens, making it an attractive location for individuals and businesses seeking to minimize their tax obligations. This low tax environment, combined with the absence of a state income tax, contributes to Tennessee's reputation as a tax-friendly state.
New Hampshire is unique in its approach to taxation, resulting in an overall tax burden that is relatively low compared to many other states. Unlike most states, New Hampshire does not levy a broad-based income or sales tax. However, it does impose some of the highest property taxes in the nation, which significantly contributes to its overall tax burden.
Despite the heavy reliance on property taxes, New Hampshire’s absence of income and sales taxes helps keep its overall tax burden below the national average. When compared to other states, New Hampshire often ranks as one of the more tax-friendly states, particularly for residents who might be able to mitigate their property tax exposure. This distinctive tax structure makes New Hampshire an appealing option for those seeking to minimize their tax obligations while still enjoying the benefits of a relatively affluent state.
North Dakota's overall tax burden is moderate compared to other U.S. states. The state features a balanced mix of taxes, including individual income tax, property tax, and sales tax. North Dakota's income tax rates are relatively low, with a top marginal rate that is among the lower third of U.S. states. Property taxes in North Dakota are also moderate, although they can vary significantly depending on the location within the state. Sales taxes are generally in line with the national average, though the combined state and local rates can fluctuate depending on the municipality.
When compared to other states, North Dakota falls around the middle of the spectrum in terms of overall tax burden. While not among the states with the lowest tax burdens, North Dakota is also far from being one of the highest-taxed states. This positions North Dakota as a state with a reasonable tax structure that provides a balance between public services and the tax load on residents.
8 Oklahoma
Oklahoma's overall tax burden is relatively moderate when compared to other U.S. states. The state levies a combination of income, property, and sales taxes, with the income tax being progressive and the sales tax generally considered high. Oklahoma's property taxes are lower than the national average, contributing to its moderate tax burden.
When ranked against other states, Oklahoma falls in the middle tier, neither among the states with the highest nor the lowest tax burdens. This balance makes Oklahoma an appealing option for residents seeking a manageable tax environment without the extremes found in states with very high or very low taxes. The state's tax policies aim to balance revenue needs with taxpayer affordability, which is reflected in its overall ranking.
9 Texas
Texas is known for its relatively low overall tax burden compared to many other states, making it an attractive option for residents seeking to minimize their tax expenses. The state does not impose a personal income tax, which significantly reduces the tax burden for individuals. Instead, Texas relies heavily on sales and property taxes to generate revenue.
The absence of an income tax positions Texas favorably in overall tax burden rankings, often placing it in the lower half compared to other states. However, the state's property taxes are among the highest in the nation, which can offset some of the benefits gained from the lack of income tax. Additionally, sales taxes in Texas are also relatively high, with a state rate of 6.25%, which can go up to 8.25% when local taxes are included.
Overall, while Texas offers a tax-friendly environment, particularly for those with higher incomes, the high property and sales taxes are important considerations for residents when comparing the state's tax burden to others.
10 Georgia
Georgia's overall tax burden is moderate compared to other U.S. states. The state combines a relatively low individual income tax rate with average property taxes and sales taxes, resulting in a tax environment that is generally favorable for residents. While Georgia does impose a state income tax, the rates are lower than in many other states with income taxes, helping to keep the overall tax burden manageable.
In comparison to other states, Georgia falls somewhere in the middle of the rankings. It does not have the lowest tax burden, like states with no income tax, but it also avoids the higher tax rates seen in states with more progressive tax structures. This balance makes Georgia an attractive state for those seeking a combination of reasonable tax rates and a relatively high quality of life.
11 Missouri
Missouri has a moderate overall tax burden compared to other U.S. states. The state's tax structure includes a combination of income taxes, property taxes, and sales taxes. Missouri has a progressive income tax system with rates ranging from low to moderate, which places it in the middle tier of states in terms of income tax burden. Property taxes in Missouri are relatively low compared to national averages, providing some relief to homeowners. Sales taxes, however, can be slightly higher, particularly in areas with additional local sales tax levies.
Overall, Missouri’s tax burden is below the national average, making it a more tax-friendly state compared to many others, especially when considering property taxes. This balance helps Missouri remain competitive in terms of affordability, attracting residents who seek a lower overall tax impact without sacrificing essential services.
12 Louisiana
Louisiana's overall tax burden is relatively moderate compared to other U.S. states. The state imposes a combination of state and local taxes, including income, property, and sales taxes. Louisiana's income tax rates are progressive but relatively low, contributing to a lighter burden on residents compared to states with higher income tax rates. Property taxes in Louisiana are among the lowest in the nation, thanks to the state's generous homestead exemption, which significantly reduces the taxable value of owner-occupied homes.
Louisiana's sales taxes are among the highest in the country when combining state and local rates, which slightly offsets the benefits of lower income and property taxes. When compared to other states, Louisiana's overall tax burden ranks near the middle, making it an affordable option, particularly for homeowners. Despite the high sales taxes, the state remains attractive for those looking for a balanced tax environment without the extremes found in states with much higher or lower tax burdens.
South Carolina's overall tax burden is moderate compared to other U.S. states. The state ranks in the middle of the pack, with a tax burden that includes relatively low property taxes and a moderate sales tax rate. South Carolina does impose a state income tax, which, while not among the highest in the nation, contributes to the overall tax load for residents.
In comparison to other states, South Carolina offers a relatively balanced tax environment. While it doesn’t have the lowest tax burden, it is also not among the highest, making it an attractive option for residents looking for a state with manageable taxes. The combination of moderate taxes and relatively affordable living costs makes South Carolina competitive with other states in terms of overall tax burden.
14 Alabama
Alabama has one of the lowest overall tax burdens in the United States, making it an attractive state for residents seeking lower taxes. The state's tax burden is primarily characterized by low property taxes and a relatively low income tax rate. However, Alabama does rely more heavily on sales taxes, which can vary significantly depending on the local jurisdiction.
Compared to other states, Alabama ranks among the lowest in terms of the percentage of personal income that goes to taxes. This low tax burden is often a draw for retirees and individuals looking for a cost-effective place to live. Despite the low taxes, it's important to note that Alabama's reliance on sales taxes can lead to a regressive impact, where lower-income residents might spend a higher proportion of their income on taxes compared to wealthier individuals.
15 Arizona
Arizona’s overall tax burden is relatively moderate compared to other U.S. states. The state has a combination of income, property, and sales taxes, which together form its tax structure. Arizona has a lower-than-average income tax rate, with a top marginal rate of 4.5%. Property taxes in Arizona are also below the national average, making it an attractive state for homeowners. However, sales taxes are on the higher side, with the combined state and local sales tax rate often exceeding 8%.
When compared to other states, Arizona ranks somewhere in the middle regarding overall tax burden. It offers a favorable environment for retirees and individuals seeking a state with lower income and property taxes, although its higher sales tax may offset some of these benefits for residents, especially those with higher consumption. Overall, Arizona provides a balanced tax environment, neither among the most burdensome nor the most lenient states in the nation.
16 Utah
Utah's overall tax burden is relatively moderate compared to other U.S. states. The state features a flat individual income tax rate, a state sales tax, and property taxes that are slightly below the national average. When combined, these taxes contribute to a tax burden that places Utah in the middle range of states.
Utah's balanced approach to taxation, with no one category being excessively high, allows it to maintain a competitive tax environment. While it doesn't have the lowest tax burden, it is more favorable than many states with higher income or property taxes. This makes Utah an attractive state for both individuals and businesses seeking a reasonable tax structure.
17 Montana
Montana's overall tax burden is relatively moderate when compared to other U.S. states. The state does not have a sales tax, which is a significant factor in its tax landscape. However, Montana does levy an individual income tax, with rates that are slightly higher than average, and property taxes that also contribute to the state's overall tax burden.
Compared to other states, Montana ranks around the middle in terms of tax burden, making it more affordable than many states with higher tax rates, particularly those with both income and sales taxes. The absence of a sales tax can be particularly beneficial for residents, especially those with lower incomes, as it reduces the overall cost of living. However, the reliance on income and property taxes means that residents still face a notable tax obligation, particularly in regions with higher property values.
Overall, Montana provides a balanced tax environment, neither the most burdensome nor the lightest, making it a competitive option for those considering relocation based on tax considerations.
18 Nevada
Nevada has a relatively low overall tax burden compared to other U.S. states, making it an attractive option for residents seeking a tax-friendly environment. One of the key factors contributing to Nevada's low tax burden is the absence of a state income tax, which significantly reduces the tax obligations for individuals and businesses.
In addition to not having a state income tax, Nevada relies heavily on sales taxes, including taxes on goods and services, as well as excise taxes on items like gasoline, tobacco, and alcohol. Property taxes in Nevada are moderate, with rates generally falling near the national average.
When compared to other states, Nevada's overall tax burden ranks among the lower third, making it particularly favorable for retirees, entrepreneurs, and those with high incomes who benefit most from the absence of state income tax. However, the reliance on sales and excise taxes means that residents might experience a higher cost of living in certain areas, but overall, Nevada remains a tax-efficient state in the national landscape.
19 Idaho
Idaho's overall tax burden is moderate compared to other U.S. states. The state imposes a mix of income, property, and sales taxes, with income tax rates that are somewhat progressive. Idaho's property taxes are relatively low, which helps keep the overall tax burden in check. However, the state's sales tax is higher than the national average, contributing a significant portion to the total tax burden.
When compared to other states, Idaho falls in the middle range for overall tax burden, making it neither among the most tax-friendly nor the most heavily taxed states. Its balanced approach to taxation provides a competitive environment for residents and businesses alike, with a total tax burden that is generally considered reasonable within the broader context of U.S. state taxation.
20 Indiana
Indiana's overall tax burden is relatively moderate compared to other U.S. states. The state features a flat income tax rate, which is lower than many states with progressive income tax systems. Property taxes in Indiana are also relatively low, which contributes to a favorable tax environment for homeowners. Additionally, Indiana has a state sales tax rate that is slightly above the national average, but it is offset by the absence of local sales taxes in most areas.
When compared to other states, Indiana's tax burden places it in the middle of the pack, making it more affordable than high-tax states like New York and California but less competitive than states with no income tax, such as Florida and Texas. Overall, Indiana provides a balanced tax environment that appeals to both businesses and residents looking for a stable and predictable tax structure.
North Carolina's overall tax burden places it in a moderate position compared to other U.S. states. The state has a relatively balanced tax system, featuring a flat income tax rate, average property taxes, and a state sales tax rate that is slightly above the national average.
North Carolina's income tax is a flat rate of 4.75%, which simplifies tax filings and is relatively low compared to states with progressive tax systems. Property taxes in North Carolina are close to the national median, contributing moderately to the overall tax burden. The state's sales tax, including both state and local levies, averages around 6.98%, which is slightly higher than in some other states but remains competitive within the Southeast.
In comparison to other states, North Carolina’s tax burden is neither among the highest nor the lowest, making it a middle-of-the-road state for taxpayers. It offers a balanced tax environment that is attractive for both residents and businesses, especially when compared to states with higher income or property taxes. This balance helps North Carolina maintain its appeal as a relatively affordable place to live while still providing necessary public services and infrastructure.
22 Mississippi
Mississippi has one of the lowest overall tax burdens in the United States. The state's tax structure is relatively light on residents, with moderate income tax rates, lower-than-average property taxes, and a sales tax rate that is competitive with other states. Mississippi does not impose a particularly high excise tax burden, contributing to its favorable ranking.
Compared to other states, Mississippi's overall tax burden is significantly lower, placing it among the states where residents retain a larger portion of their income. This makes Mississippi an attractive option for those seeking a lower cost of living through reduced tax obligations. However, it's important to consider that while the tax burden is low, this can also reflect lower public service funding and varying levels of infrastructure investment.
23 Arkansas
Arkansas has a moderate overall tax burden compared to other U.S. states. The state imposes a combination of income, property, and sales taxes. Arkansas' individual income tax rates are progressive, with rates ranging from 2% to 5.9%. The state also has a sales tax rate of 6.5%, which is higher than the national average, and local jurisdictions can add their own taxes, making the combined rate even higher in some areas. Property taxes in Arkansas are relatively low, which helps balance the overall tax burden.
When compared to other states, Arkansas falls around the middle of the pack. While its income and sales taxes contribute to a higher burden, the relatively low property taxes help mitigate the overall impact on residents. Arkansas is neither among the states with the highest tax burdens nor the lowest, making it an average state in terms of the overall tax load on its residents.
24 Kentucky
Kentucky's overall tax burden is moderate compared to other U.S. states. The state imposes an income tax with a flat rate of 5%, which contributes significantly to its tax revenue. Kentucky also has a 6% sales tax, which is relatively low compared to other states with higher rates or additional local sales taxes. Property taxes in Kentucky are generally lower than the national average, which can make homeownership more affordable compared to states with higher property tax rates.
When compared to other states, Kentucky's tax burden is on the lower end, making it more affordable in terms of taxation. However, it is essential to consider that Kentucky's tax policies are balanced by the state's economic conditions, including income levels and the cost of living, which may influence how residents perceive their overall tax burden.
25 Kansas
Kansas has a moderate overall tax burden compared to other U.S. states. The state relies heavily on income and sales taxes, while property taxes are also a significant source of revenue. Kansas ranks near the middle of the pack in terms of overall tax burden, meaning it is neither among the states with the highest nor the lowest tax rates.
Income taxes in Kansas are progressive, with higher earners paying a higher percentage of their income. The state sales tax rate is relatively high, and when combined with local sales taxes, it can result in a substantial tax on goods and services. Property taxes in Kansas are also above the national average, particularly in urban and suburban areas.
Compared to other states, Kansas’ tax burden is higher than states with no income tax, such as Florida or Texas, but lower than states with high income and property taxes like New York or California. The overall tax burden in Kansas reflects a balance between generating revenue and maintaining competitiveness with neighboring states.
26 Michigan
Michigan's overall tax burden is moderate compared to other U.S. states. The state has a flat income tax rate, which is relatively low, making it less burdensome for higher-income earners. However, Michigan's property taxes are on the higher side, which can increase the overall tax burden for homeowners. Sales taxes in Michigan are average, with a state rate of 6% and no additional local sales taxes.
When compared to other states, Michigan falls in the middle range, meaning it is neither among the states with the highest nor the lowest overall tax burdens. This balance of taxes makes Michigan relatively affordable in terms of taxation, particularly for those who benefit from its lower income tax rate.
27 Virginia
Virginia’s overall tax burden is moderate compared to other U.S. states. The state ranks around the middle in terms of the percentage of personal income that goes to state and local taxes. Virginia’s tax structure includes an income tax with progressive rates, which means that higher earners pay a higher percentage of their income in taxes. Additionally, the state levies property taxes that are relatively low compared to the national average, and it has a state sales tax that is also moderate.
Compared to other states, Virginia does not have an exceptionally high or low tax burden, making it an average state in terms of overall taxation. This balance makes Virginia attractive to residents who are seeking a state with reasonable tax rates while still benefiting from well-funded public services.
28 Ohio
Ohio ranks around the middle in terms of overall tax burden compared to other U.S. states. The state imposes a combination of income, sales, and property taxes. Ohio's state income tax is progressive, with multiple brackets, while its sales tax rate is slightly below the national average. Property taxes in Ohio are somewhat higher than the national median, contributing significantly to the overall tax burden.
Compared to other states, Ohio's tax burden is neither among the highest nor the lowest, making it relatively moderate. Residents experience a balanced mix of taxes without being overly burdened by any single category. This moderate tax environment can make Ohio an attractive option for those seeking a balance between public services and taxation.
29 Pennsylvania
Pennsylvania has a tax burden that places it in a relatively moderate position compared to other U.S. states. The state's overall tax burden is influenced by a combination of individual income taxes, property taxes, and sales taxes. Pennsylvania levies a flat state income tax rate of 3.07%, which is relatively low compared to many other states that use a progressive tax system. Property taxes in Pennsylvania can be quite high, especially in certain counties, which impacts the overall tax burden. Sales taxes in Pennsylvania are also moderate, with a base state sales tax rate of 6%, though some localities can add additional percentages.
When compared to other states, Pennsylvania's tax burden is generally seen as moderate. It is higher than in states without state income taxes but lower than in states with higher income tax rates and property taxes. Pennsylvania's approach to taxation reflects a balance between generating revenue for public services and maintaining a competitive tax environment for residents and businesses.
30 Colorado
Colorado's overall tax burden is moderate compared to other states in the U.S. The state has a flat income tax rate, which is relatively low compared to states with progressive tax rates. Property taxes in Colorado are also below the national average, which helps reduce the overall tax burden for homeowners. However, sales taxes in Colorado can be somewhat higher than average due to the combination of state and local rates.
When compared to other states, Colorado generally falls in the middle of the pack in terms of tax burden. It is neither among the states with the highest tax burdens, like California or New York, nor among those with the lowest, such as Wyoming or South Dakota. This balanced approach to taxation makes Colorado an attractive option for residents seeking a blend of reasonable tax rates with a strong economy and high quality of life.
West Virginia has a relatively moderate overall tax burden when compared to other U.S. states. The state's tax burden includes income taxes, property taxes, and sales taxes. West Virginia imposes a state income tax with rates that vary based on income levels, but its overall income tax rates are relatively average compared to other states.
Property taxes in West Virginia are on the lower end, which helps to keep the overall tax burden more manageable for residents. Sales taxes in West Virginia are also moderate, though the state does impose additional excise taxes on specific goods, such as gasoline and cigarettes.
When compared to other states, West Virginia's overall tax burden is generally ranked in the middle or slightly below average. This means that while West Virginians pay a fair share of taxes, they are not among the most heavily taxed in the nation. The state's tax policies aim to balance revenue generation with maintaining affordability for its residents, contributing to its moderate standing in national tax burden rankings.
32 New Mexico
New Mexico's overall tax burden is moderately high compared to other U.S. states. The state imposes a combination of income, sales, property, and excise taxes that collectively place it in the middle to upper range of tax burdens nationwide.
New Mexico's income tax rates are progressive, meaning they increase with income, and the state has a gross receipts tax, which functions similarly to a sales tax but applies more broadly to goods and services. Property taxes in New Mexico are relatively low compared to the national average, which helps offset some of the higher tax costs from income and sales taxes.
In comparison to other states, New Mexico's tax burden is higher than in states with no income tax, like Texas and Florida, but lower than in states with high income and property taxes, such as California and New York. This balance of tax policies makes New Mexico moderately competitive, particularly for those seeking lower property taxes in exchange for slightly higher income and sales taxes.
33 Minnesota
Minnesota ranks relatively high in terms of overall tax burden compared to other U.S. states. The state has a progressive income tax system with multiple brackets, making it one of the higher-taxed states in the country. In addition to income taxes, Minnesota has a relatively high property tax rate and a state sales tax that is above the national average, although some localities add additional sales taxes.
When compared to other states, Minnesota's tax burden is among the top ten highest in the nation. This higher tax burden is often justified by the state's investment in public services, such as education, healthcare, and infrastructure, which are consistently ranked among the best in the country. However, residents of Minnesota pay more in taxes as a percentage of their income than those in many other states, making it less favorable for individuals or businesses seeking a low-tax environment.
34 Wisconsin
Wisconsin ranks among the higher-taxed states in the U.S. when it comes to overall tax burden. The state imposes a relatively high tax burden on its residents, with significant contributions from property taxes and state income taxes. Wisconsin's income tax rates are progressive, with multiple brackets, which, combined with its property tax rates, place the state above the national average in terms of overall tax burden.
Compared to other states, Wisconsin consistently ranks in the top third for tax burden, making it less tax-friendly than many states, particularly those without state income taxes or with lower property taxes. While Wisconsin’s sales tax is relatively modest compared to other states, it is not enough to offset the higher income and property taxes. As a result, residents in Wisconsin face a heavier tax burden than those in many other states, though this is balanced by strong public services and infrastructure supported by these revenues.
Massachusetts has a relatively high overall tax burden compared to other U.S. states. The state ranks above average in terms of individual income taxes and property taxes, both of which contribute significantly to its tax burden. Massachusetts does not have a sales tax as high as some other states, but its combination of income and property taxes places it among the states with a heavier tax load on residents.
When compared to other states, Massachusetts tends to rank in the top third for overall tax burden, meaning residents pay a higher percentage of their income in taxes than those in many other states. This can be attributed to the state's progressive income tax system, higher property values, and robust public services, which require greater revenue. Despite the higher tax burden, Massachusetts also offers a high quality of life and substantial public benefits, which can offset the impact of higher taxes for many residents.
36 Maryland
Maryland's overall tax burden is relatively high compared to other states, placing it among the states with a heavier tax load on its residents. The state has a progressive income tax structure, meaning higher earners pay a higher percentage of their income in taxes. Additionally, Maryland imposes substantial property taxes and has a state sales tax that, while moderate, contributes to the overall tax burden.
When compared to other states, Maryland's tax burden is higher than the national average, particularly due to its income and property taxes. However, it is balanced by relatively modest sales taxes and certain tax credits available to residents. Despite its higher tax rates, Maryland also offers a range of public services and benefits, which some residents may find offsets the higher costs.
37 Delaware
Delaware has a relatively moderate overall tax burden compared to other U.S. states. The state is known for having no sales tax, which significantly reduces the tax load on consumers. Delaware also boasts low property taxes, ranking among the lowest in the nation. While the state does impose income taxes, they are moderate, especially when compared to states with higher income tax rates.
Overall, Delaware's tax burden is lower than the national average, making it an attractive option for individuals and businesses looking for a more tax-friendly environment. The absence of a sales tax and low property taxes are key factors that contribute to its competitive position in the rankings.
38 Maine
Maine's overall tax burden is relatively high compared to other U.S. states. The state ranks among the top states with the highest tax burdens due to its significant property tax rates and state income tax. Maine's tax structure is heavily reliant on property taxes, which are among the highest in the nation, contributing significantly to the overall tax burden for its residents. Additionally, Maine's state income tax is progressive, with multiple brackets that can lead to a higher percentage of income being taxed as earnings increase.
Compared to other states, Maine's tax burden is on the higher end, making it less favorable for residents seeking lower taxes. However, this higher tax burden is often balanced by the state's investment in public services, education, and infrastructure, which can provide added value to residents despite the higher taxes.
39 Rhode Island
Rhode Island has one of the higher overall tax burdens in the United States. The state's residents face a combination of relatively high property taxes, income taxes, and sales taxes, which contribute to the elevated tax burden. Compared to other states, Rhode Island ranks among the states with a higher tax burden, making it less tax-friendly for residents. Property taxes are particularly notable, often ranking among the highest in the nation, while income and sales taxes also contribute significantly to the overall burden. Despite its small size, Rhode Island's tax policies create a heavier financial impact on its residents compared to many other states.
40 Connecticut
Connecticut has one of the highest overall tax burdens in the United States. The state imposes significant taxes across several categories, including income, property, and sales taxes. Connecticut’s income tax rates are progressive, with higher earners paying a larger percentage of their income, which contributes to its high tax burden. Property taxes in Connecticut are also among the highest in the nation, driven by high property values and local government spending.
When compared to other states, Connecticut consistently ranks in the top tier for overall tax burden, placing it as one of the most expensive states for taxpayers. This high tax burden is often cited as a factor in the state’s economic challenges, including slow population growth and the migration of residents to states with lower taxes.
41 Iowa
Iowa's overall tax burden is moderate compared to other U.S. states. The state imposes taxes on income, property, and sales, with income taxes being progressive, meaning higher earners pay a higher percentage. Iowa's property taxes are relatively high, which contributes significantly to its overall tax burden. However, the state's sales tax is around the national average, and there are no local option taxes in some areas, which helps to balance out the burden.
When compared to other states, Iowa does not rank among the highest or lowest in terms of overall tax burden. It falls in the middle range, making it comparable to many Midwestern states where the tax structure is balanced but slightly higher in property taxes. This makes Iowa a state where the tax burden is noticeable but not excessive, providing a stable environment for residents.
42 Oregon
Oregon's overall tax burden is characterized by the absence of a state sales tax, which significantly impacts its ranking compared to other states. The state relies heavily on income taxes to generate revenue, with individual income taxes being one of the highest in the country. Property taxes in Oregon are moderate, contributing to a balanced, though slightly higher, overall tax burden.
Compared to other states, Oregon's tax burden is considered above average, primarily due to its high income tax rates. However, the lack of a sales tax offsets some of this burden, particularly for consumers. This makes Oregon an interesting case where the overall tax structure is unique, leading to a different tax experience than in states with lower income taxes but higher sales or property taxes.
43 Washington
Washington State has a unique tax structure that results in a moderate overall tax burden compared to other U.S. states. The state does not impose a personal income tax, which can make it more attractive for higher-income individuals. However, Washington has one of the highest sales tax rates in the country, which can disproportionately affect lower-income residents. Additionally, property taxes in Washington are relatively high, contributing to the overall tax burden.
When compared to other states, Washington's lack of an income tax helps keep its overall tax burden lower than in states with high income taxes, like California and New York. However, the reliance on sales and property taxes places Washington around the middle of the pack in national rankings. The state's tax system is often seen as regressive, meaning it takes a larger percentage of income from low-income residents than from high-income residents. This balance of no income tax with high sales and property taxes creates a mixed picture for taxpayers in Washington.
44 Nebraska
Nebraska has a relatively high overall tax burden compared to other states, primarily due to its significant reliance on property taxes. The state imposes individual income taxes, property taxes, and sales taxes, which together contribute to a tax burden that ranks higher than the national average. While Nebraska's income tax rates are moderate, the property tax rates are among the highest in the country, placing a considerable strain on homeowners and agricultural landowners.
When compared to other states, Nebraska's tax burden is generally higher than in states with no income tax or lower property tax rates. However, it may be more favorable than states with both high income and property taxes. Overall, residents in Nebraska experience a heavier tax load than those in many other parts of the country, making it less competitive in terms of tax affordability.
45 Vermont
Vermont has one of the highest overall tax burdens in the United States, consistently ranking among the top states for the percentage of income residents pay in state and local taxes. The state's tax burden includes significant contributions from property taxes, income taxes, and sales taxes, all of which are relatively high compared to national averages.
Vermont’s property tax is particularly notable for its impact on the overall tax burden, as the state relies heavily on this revenue source to fund education and local services. Additionally, Vermont has a progressive income tax system, with rates that increase with higher income levels, adding to the burden on middle- and upper-income residents.
Compared to other states, Vermont’s tax burden is heavier, placing it near the top of national rankings. This high tax burden reflects the state’s commitment to funding public services, but it also means that residents pay a larger share of their income in taxes than those in many other states.
46 California
California is known for having one of the highest overall tax burdens in the United States. The state levies a combination of high income, sales, and property taxes, which collectively place a significant tax load on residents. California's state income tax is particularly noteworthy, with a top marginal rate that is among the highest in the country. Sales taxes in California are also on the higher side, with a statewide base rate that can be further increased by local jurisdictions.
When compared to other states, California's overall tax burden consistently ranks near the top. This high tax burden is a result of the state's extensive social services, public infrastructure, and environmental initiatives, which require substantial revenue. While these taxes contribute to the state's robust public services, they also make California one of the most expensive states to live in, particularly when compared to states with lower tax burdens.
47 Illinois
Illinois has one of the highest overall tax burdens in the United States. Residents face a significant combined state and local tax rate, which includes income, property, and sales taxes. The state's flat income tax rate is complemented by high property taxes, which rank among the highest in the nation. Sales taxes in Illinois also contribute to the state's heavy tax load, with rates that are higher than the national average.
When compared to other states, Illinois consistently ranks near the top in terms of tax burden, often placing within the top 10 most heavily taxed states. This makes Illinois less favorable for taxpayers compared to states with lower tax burdens, such as those with no state income tax or lower property taxes. Despite this, Illinois continues to maintain its tax policies to support state funding needs, which contributes to its overall tax ranking.
48 New Jersey
New Jersey consistently ranks as one of the states with the highest overall tax burden in the United States. This high tax burden is primarily driven by the state's substantial property taxes, which are among the highest in the nation. In addition to property taxes, New Jersey residents face significant income and sales taxes, contributing to the state's overall tax load.
When compared to other states, New Jersey's tax burden is one of the heaviest, placing it near the top of the list in national rankings. The combination of high property taxes and relatively high income taxes makes New Jersey less tax-friendly than many other states, leading to a higher percentage of residents' income going toward state and local taxes. This ranking reflects the state's reliance on these taxes to fund its budget and public services.
49 New York
New York State is known for its relatively high tax burden, which includes income, property, and sales taxes. The state income tax rates are progressive, with higher rates for higher income brackets. However, there are tax exemptions for retirement income, such as Social Security benefits and some pensions, which can alleviate some of the burden for retirees.
Property taxes in New York are among the highest in the nation, particularly in suburban areas. However, the state offers the STAR (School Tax Relief) program, which provides property tax relief for eligible seniors. Retirees should carefully assess their potential tax liabilities when considering a move to New York State.
50 Hawaii
Hawaii has one of the highest overall tax burdens in the United States, ranking among the top states where residents pay a significant portion of their income in taxes. This high tax burden is primarily driven by the state's high individual income taxes and property taxes. Additionally, Hawaii's general excise tax (which functions similarly to a sales tax) is broad and impacts a wide range of goods and services, further contributing to the overall tax burden.
Compared to other states, Hawaii's tax burden is significantly higher due to the state's unique economic and geographic factors, including its reliance on imported goods and its cost of living. Despite the higher taxes, Hawaii also offers robust public services and infrastructure, which some residents may find offsets the tax costs.