States Where Sales Taxes Are the Highest
Slide Show

10 States With the Highest Sales Taxes

Getty Images

Advertisement

Before you embark on a shopping spree in any of the 10 worst states for sales taxes, make extra room in your budget. Tennessee, for example, is in a tie for the highest sales tax in the country, at 9.47%, once both state and local sales taxes are factored in, according to the Tax Foundation.

But retirees and other relocators shouldn’t judge a state by its sales tax alone. Residents of the Volunteer State pay no state income tax, for instance, making Tennessee actually one of the more tax-friendly states in our 2019 rankings despite the big grab at the register.

SEE ALSO: 31 Cheapest U.S. Cities for Early Retirement

Advertisement
Advertisement

Sales tax values are for 2019 and were compiled by the Tax Foundation. Income tax brackets are for the 2018 tax year.More about our methodology here.

Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 2 of 11

10. New York

Getty Images

Advertisement

Overall Rating for Taxes: Least tax-friendly

State Sales Tax: 4% state levy. Localities can add as much as 4.88%, and the average combined rate is 8.49%, according to the Tax Foundation. In the New York City metro area, there is an additional 0.375% sales tax to support transit. Clothing and footwear that cost less than $110 (per item or pair) are exempt from sales tax.

Income Tax Range: Low: 4.0% (on up to $8,500 of taxable income for single filers and up to $17,150 for married couples filing jointly); High: 8.82% (on taxable income over $1,070,550 for single filers and over $2,155,350 for married couples filing jointly). New York allows localities to impose an income tax; the average levy is 2.11%, per the Tax Foundation.

Advertisement
Advertisement

For details on other state taxes, see the complete guide to taxes in New York.

SEE ALSO: Best and Worst States at Minting Millionaires Since the Financial Crisis

Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 3 of 11

9. California

Getty Images

Advertisement

Overall Rating for Taxes: Tax-friendly

State Sales Tax: 7.25% state levy. Localities can add as much as 2.50%, and the average combined rate is 8.66%, according to the Tax Foundation.

Income Tax Range: Low: 1% (on up to $17,088 of taxable income for married joint filers and up to $8,544 for those filing individually); High: 13.3% (on more than $1,145,960 for married joint filers and $1 million for those filing individually).

For details on other state taxes, see the complete guide to taxes in California.

SEE ALSO: 10 States with the Highest Gas Taxes

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 4 of 11

8. Kansas

Getty Images

Advertisement

Overall Rating for Taxes: Least tax-friendly

State Sales Tax: 6.50% state levy. Localities can add as much as 4.00%, and the average combined rate is 8.67%, according to the Tax Foundation. These rates apply to groceries as well. A food sales tax credit of $125 per person is available to seniors and those claiming dependents; there are income limitations for this credit.

Income Tax Range: Low: 3.1% (on $15,000 or less of taxable income for single filers and $30,000 or less for joint filers); High: 5.7% (on more than $30,000 of taxable income for single filers and more than $60,000 for joint filers).

Advertisement
Advertisement

For details on other state taxes, see the complete guide to taxes in Kansas.

SEE ALSO: The Most Expensive Natural Disasters in U.S. History

Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 5 of 11

7. Illinois

Getty Images

Advertisement

Overall Rating for Taxes: Least tax-friendly

State Sales Tax: 6.25% state levy. Localities can add as much as 4.75%, and the average combined rate is 8.78%, according to the Tax Foundation. Food, prescription drugs and non-prescription drugs are all taxed at 1% by the state; candy and soda, no matter where they’re purchased, are taxed at 6.25%.

Income Tax Range: There is a flat rate of 4.95% of federal adjusted gross income after modifications.

For details on other state taxes, see the complete guide to taxes in Illinois.

SEE ALSO: All 47 Warren Buffett Stocks Ranked: The Berkshire Hathaway Portfolio

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 6 of 11

6. Oklahoma

Getty Images

Advertisement

Overall Rating for Taxes: Mixed tax picture

State Sales Tax: 4.50% state levy. Localities can add as much as 7.00%, and the average combined rate is 8.94%, according to the Tax Foundation.

Income Tax Range: Low: 0.5% (on up to $1,000 of taxable income for single filers and up to $2,000 for married joint filers); High: 5% (on taxable income over $7,200 for single filers and over $12,200 for married joint filers).

For details on other state taxes, see the complete guide to taxes in Oklahoma.

SEE ALSO: The Best Online Brokers, 2019

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 7 of 11

5. Alabama

Getty Images

Advertisement

Overall Rating for Taxes: Tax-friendly

State Sales Tax: 4% state levy. Localities can add as much as 7% to that, and the average combined rate is 9.16%, according to the Tax Foundation. Alabama is one of the few states that does not exempt food from sales tax.

Income Tax Range: Low: 2% (on up to $1,000 of taxable income for married joint filers and up to $500 for all others); High: 5% (on more than $6,000 of taxable income for married joint filers and more than $3,000 for all others). Alabama also allows residents to deduct all of their federal income tax from state taxable income.

Advertisement
Advertisement

For details on other state taxes, see the complete guide to taxes in Alabama.

SEE ALSO: The Safest Used Cars for $20,000 or Less

Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 8 of 11

4. Washington

Getty Images

Advertisement

Overall Rating for Taxes: Most tax-friendly

State Sales Tax: 6% state levy. Municipalities can add up to 4.00% to that, with the average combined rate at 9.21%, according to the Tax Foundation.

Income Tax Range: Washington has no state income tax.

For details on other state taxes, see the complete guide to taxes in Washington.

SEE ALSO: 12 States That Won't Tax Your Retirement Income

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 9 of 11

3. Louisiana

Advertisement

Overall Rating for Taxes: Tax-friendly

State Sales Tax: 5.0% state levy. Localities can add as much as 7%, and the average combined rate is 9.45%, according to the Tax Foundation. Groceries and prescription drugs are exempt from the state's sales tax, but localities may tax these.

Income Tax Range: Low: 2% (on $12,500 or less of taxable income for individuals, $25,000 for joint filers); High: 6% (on more than $50,000 of taxable income; $100,000 for joint filers). Residents can deduct all of their federal income tax from state taxable income.

For details on other state taxes, see the complete guide to taxes in Louisiana.

SEE ALSO: 10 Most Tax-Friendly States for Retirees

SEE ALSO: 13 States That Tax Social Security Benefits in Retirement

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 10 of 11

2. Arkansas (Tie)

Getty Images

Advertisement

Overall Rating for Taxes: Not tax-friendly

State Sales Tax: 6.5% state levy. Localities can add as much as 5.125%, and the average combined rate is 9.47%, according to the Tax Foundation. The state taxes food at 1.5%, and localities can add to that.

Income Tax Range: Low: 0.9% (on up to $4,499 of taxable income); High: 6.9% (on more than $79,301 of taxable income).

For details on other state taxes, see the complete guide to taxes in Arkansas.

SEE ALSO: 31 Best Amazon Prime Benefits to Use in 2019

Advertisement
Advertisement
Advertisement
Advertisement

States Where Sales Taxes Are the Highest | Slide 11 of 11

1. Tennessee (Tie)

Getty Images

Advertisement

Overall Rating for Taxes: Most tax-friendly

State Sales Tax: 7% state levy. Localities can add up to 2.75%, with an average combined rate of 9.47%, according to the Tax Foundation. Groceries are taxed at 4% by the state, plus whatever local rate is in effect. Local taxes are limited, though: Only the first $1,600 of any item is taxable.

Income Tax Range: There's no state income tax, so salaries, wages, Social Security benefits, IRA distributions and pension income are not taxed. But Tennessee does have the Hall Tax, which taxes dividends and some interest at 3% (in 2018). The first $1,250 in taxable income for individuals ($2,500 for joint filers) is exempt. The rate for the Hall Tax is set to decline annually by one percentage point until it is phased out entirely by 2021.

Advertisement
Advertisement

For details on other state taxes, see the complete guide to taxes in Tennessee.

SEE ALSO: Retirement Planning Mistakes You'll Regret Forever

Advertisement
Advertisement