State tax rates and rules for income, sales, gas, property, cigarette, and other taxes that impact middle-class families. Go to the Kiplinger Tax Map Michigan Add to State Compare List | View List View State Compare List (0) selected | Compare up to 5 The Bottom Line Least Tax-Friendly Michigan has a flat state income tax of 4.25%, which municipalities get to add to. Municipalities cannot, however, add to the state sales tax, which remains a modest 6%. Property taxes are well above the national average, however. Income Tax Range Michigan has a flat tax rate of 4.25%. Cities can levy income taxes as well, on both residents and non-residents (who are taxed 1/2 the rate of residents). Sales Tax 6% state levy. No local taxes.Groceries: Exempt, but prepared food is taxableClothing: TaxableMotor Vehicles: TaxablePrescription Drugs: Exempt Real Property Taxes In Michigan, the median property tax rate is $1,448 per $100,000 of assessed home value. Motor Fuel Taxes Gasoline: 45.12¢ per gallon. Diesel: 44.46¢ per gallon. Sin Taxes Cigarettes: $2 per packPremium cigars (more than $1.56/piece wholesale): $0.50 per cigarOther tobacco products: 32% of wholesale priceBeer: $0.20 per gallonWine: $0.51 per gallon ($0.76 if above 16% alcohol by volume)Liquor: 12% of retail price (4% general fund tax, 4% state school aid tax, and 4% convention facility development tax)Marijuana: 10% excise tax, plus state sales tax Annual Car Taxes and Fees No annual vehicle tax or fee is imposed. Estate and Inheritance Taxes No estate or inheritance tax.