It's not what you earn, it's what you keep that often dictates your standard of living. With that in mind, take this quick tour of the ten cities in the nation that have the lowest overall tax burden. These cities came out on top (er, at the bottom, really) of the 2007-2008 District of Columbia Tax Rates and Tax Burdens Survey for the largest city in each state, plus D.C.
Tax rankings are based on 2007 tax return computations for a two-income couple earning $75,000 with one school age child. The real property tax is a function of housing values, real estate tax rates, assessment levels, homeowner exemptions and credits. The auto tax figure assumes the couple owns two cars and is based on the estimated registration fees, state and local gasoline taxes, and personal property taxes, if any.
No. 1 Anchorage, Alaska
Income tax: $0
Property tax: $2,572
Sales tax: $0
Auto tax: $165
STATE & LOCAL TAX BURDEN: 3.6%
(National median tax burden: 8.5%)
Urban Facts: Taxes? Residents of Anchorage actually receive an annual "dividend" payment derived from levies on state oil drilling operations.
In sheer geographic size, the city of Anchorage is larger than the state of Rhode Island. It is home to 42% of all Alaskan residents.
Sponsored Content
Sponsored Content
Sponsored Content
No. 4 Seattle, Washington
Income tax: $0
Property tax: $1,698
Sales tax: $1,561
Auto tax: $457
STATE & LOCAL TAX BURDEN: 5.0%
Urban Facts: Seattle may be a tax-friendly city, but it also has a high cost of living, well above the national average.
The median home sales price was $375,000 for last quarter of 2008, compared to $200,000 at the national level.
Sponsored Content
No. 5 Las Vegas, Nevada
Income tax: $0
Property tax: $2,251
Sales tax: $1,072
Auto tax: $486
STATE & LOCAL TAX BURDEN: 5.1%
Urban Facts: Gaming taxes account for 27% of the state's general revenue funds.
The city's rapid growth a few years ago that drew more than 5,000 new residents every month was propped up on subprime lending. Now Las Vegas has the highest foreclosure rate among U.S. cities.
Sponsored Content
No. 6 Jacksonville, Florida
Income tax: $0
Property tax: $2,456
Sales tax: $1,284
Auto tax: $195
STATE & LOCAL TAX BURDEN: 5.2%
Urban Facts: The state intangibles tax on certain investments was repealed in 2007.
Jacksonville is the third-most populous city on the East Coast, after New York City and Philadelphia. (Other cities such as Boston, Washington, D.C., and Miami have larger metropolitan area populations.)
Sponsored Content
No. 7 Sioux Falls, South Dakota
Income tax: $0
Property tax: $2,760
Sales tax: $1,518
Auto tax: $294
STATE & LOCAL TAX BURDEN: 6.1%
Urban Facts: In fiscal year 2007, lottery gaming put $110 million in the state till to provide a 30% property-tax relief.
Sioux Falls has the largest shopping center between Minneapolis and Denver.
Sponsored Content
No. 8 Phoenix, Arizona
Income tax: $1,241
Property tax: $1,401
Sales tax: $1,849
Auto tax: $588
STATE & LOCAL TAX BURDEN: 6.8%
Urban Facts: Tax information for Phoenix includes the entire metropolitan area which extends to cities of Scottsdale, Mesa, Tempe, Mesa, Chandler, Gilbert, Glendale and Peoria. But housing prices and local tax can vary significantly from locality to locality.
Sponsored Content
No. 9 Billings, Montana
Income tax: $2,559
Property tax: $1,865
Sales tax: $0
Auto tax: $689
STATE & LOCAL TAX BURDEN: 6.8%
Urban Facts: Billings taxpayers with adjusted gross incomes of less than $30,000 can exclude up to $3,600 of their pension income from state taxes.
Dubbed locally as the "Magic City," Billings is supporting growth by dunning its energy, agriculture, and transportation industries.
Sponsored Content
No. 10 Chicago, Illinois
Income tax: $2,019
Property tax: $1,023
Sales tax: $1,624
Auto tax: $478
STATE & LOCAL TAX BURDEN: 6.9%
Urban Facts: Chicago's effective real-estate tax rate of .70% and various exemption programs keep real property tax low. Just keep in mind that this surprisingly tax-friendly city doesn't offer the same breaks for other cost-of-living expenses.
SOURCE: 2007-2008 District of Columbia Tax Rates and Tax Burdens Survey
Sponsored Content
-
How to Navigate Your Medicare Advantage Plan in a DisasterIf you're a Medicare Advantage member in an area that has been impacted by a disaster, you might be worried about access to care and medicine. Here's what you need to know.
-
Older Investors: Boost Your Savings and Retire EarlierThis one measure can help older investors retire up to two years earlier and potentially double their retirement savings.
-
Retirees Should Watch These Four Key Tax Changes in 2025Tax Changes This year brings key tax changes that could affect your retirement taxes and income.
-
Tariff Stimulus Checks Coming? New Proposal Seeks Tax Rebates for US WorkersTax Breaks A new GOP bill proposes to send $600 in tariff rebate checks to eligible taxpayers. Is there a catch?
-
Biggest Winners and Losers in Trump's New Tax PlanTax Law Trump’s mega tax overhaul, known as the ‘One Big Beautiful Bill,’ has distinct winners and losers. Which group do you fall into?
-
Five Ways Trump’s 2025 Tax Bill Could Boost Your Tax Refund (or Shrink It)Tax Refunds The tax code is changing again, and if you’re filing for 2025, Trump’s ‘big beautiful’ bill could mean a bigger refund, a smaller one or something in between next year. Here are five ways the new law could impact your bottom line.
-
New SALT Deduction Could Put Thousands Back in California Homeowners’ PocketsTax Breaks The federal state and local sales tax (SALT) deduction cap is higher this year, and could translate into bigger savings for Golden State homeowners.
-
Money for Your Kids? Three Ways Trump's ‘Big Beautiful Bill’ Impacts Your Child's FinancesTax Tips The Trump tax bill could help your child with future education and homebuying costs. Here’s how.
-
New Cap on Gambling Loss Deductions Begins Soon: What to Know NowTax Changes A gambling losses tax deduction cap in Trump’s “big beautiful bill” is causing an uproar. Here’s what you need to know.
-
Key 2025 Tax Changes for Parents in Trump's MegabillTax Changes Are you a parent? The so-called ‘One Big Beautiful Bill’ (OBBB) impacts several key tax incentives that can affect your family this year and beyond.
