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 New Jersey Add to State Compare List | View List View State Compare List (0) selected | Compare up to 5 The Bottom Line Least Tax-Friendly While New Jersey gives residents a break on income and sales taxes, it brings the hammer down when they buy a home. New Jersey's property taxes are the highest in the U.S. The state-wide average property tax on a $300,000 home in New Jersey comes to a whopping $7,251. Income taxes in New Jersey on middle-class taxpayers are quite low, but the state has a steeply progressive rate structure — and a "millionaire’s tax." Income Tax Range Low: 1.4% (on up to $20,000 of taxable income)High: 10.75% (on taxable income over $1 million)Newark also imposes a payroll tax. Sales Tax 6.625% state levy. That rate is cut in half (3.3125%) for in-person sales in designated Urban Enterprise Zones located in disadvantaged areas. Salem County, which borders no-tax Delaware, also charges the reduced 3.3125% rate. As a result, the average rate in the state is 6.6%, according to the Tax Foundation.Groceries: ExemptClothing: ExemptMotor Vehicles: Taxable (6.625% throughout state)Prescription Drugs: Exempt Real Property Taxes In New Jersey, the median property tax rate is $2,417 per $100,000 of assessed home value. Motor Fuel Taxes Gasoline: 42.4¢ per gallon. Diesel: 49.4¢ per gallon. Sin Taxes Cigarettes: $2.70 per packMoist snuff: $0.75 per ounceOther tobacco products: 30% of the wholesale priceVapor products: $0.10 per ml for closed containers; bulk nicotine liquid is taxed at 10% of retail priceBeer: $0.12 per gallonWine: $0.88 per gallonLiquor: $5.50 per gallonMarijuana: Sales tax applies to marijuana sales; local taxes of up to 2% may also apply Annual Car Taxes and Fees No annual vehicle tax or fee is imposed. Estate and Inheritance Taxes New Jersey imposes an inheritance tax on inherited property with a value of $500 or more. No tax is imposed on transfers to the decedent's spouse, domestic partner, parents, grandparents, children and their descendants, or step-children (step-grandchild and their descendants are not exempt). The first $25,000 of property inherited by a decedent's sibling, son-in-law or daughter-in-law is also exempt. After that, they must pay the inheritance tax at rates ranging from 11% to 16%. All other individual heirs pay a 15% tax on the first $700,000 of inherited property and a 16% tax on everything over $700,000.