Which State Pays the Least Taxes?
- Income taxes are perhaps the most important type of tax for the average worker. No matter who you are, income taxes will affect you if you earn money. Income taxes are especially important for those with high incomes, because they often face higher income tax rates. According to "U.S. News & World Report," Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming have no state income tax, and New Hampshire and Tennessee only tax dividend and interest income.
- Sales taxes are taxes imposed on the sale of goods in a state. If you buy a car, jewelry or a new TV, you will have to pay state sales tax if a tax applies. Sales taxes apply to those who spend money; it is possible to avoid sales taxes by saving or investing money instead of spending. "U.S. News & World Report" states that five states charge no sales tax: Alaska, Delaware, Montana, New Hampshire and Oregon.
- Gasoline is a necessary resource for many workers to commute to jobs and perform routine daily activities. Many states tax gasoline to raise money necessary to maintain roads and undertake new road construction projects. According to MSNMoney.com, Alaska is the only state without a tax on gasoline, while Georgia, Wyoming and New Jersey charge taxes of less than 15 cents per gallon of gas.
- Cigarettes are known to cause health problems and as a result, many states tax them at rates higher than other products. Taxes on products that are deemed to be unhealthy or morally questionable are known as "sin taxes." According to MSNMoney.com, cigarette taxes are lowest in South Caroline, which charges a tax of 7 cents a pack, followed by Missouri, which charges a tax of 17 cents a pack. Some states charge taxes of $2 or more per pack.