state tax

Alaska State Tax Guide

State tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact Alaska residents.

Bottom Line

Middle-Class Families: Most Tax-Friendly (Go to the Kiplinger Tax Map for Middle-Class Families)
Retirees: Tax-Friendly (Go to the Kiplinger Tax Map for Retirees)

In the Last Frontier, not only is there no state income tax, but the state actually pays legal residents who have lived there for at least one year an annual stipend, called the Permanent Fund Dividend. The 2021 payout was $1,114.

The state's sales taxes vary dramatically by location. However, the statewide average sales tax rate is quite low at only 1.76%. Fuel taxes are super low, too.

Property taxes run a little high when compared to other states, but not by much. The state also has very high tax rates for beer and other alcoholic beverages. So don't cry in your beer when you get your property tax bill in the mail. Overall, though, Alaska is a good place to live as far as the tax burden goes.

Alaska Income Taxes

Alaska has no state income tax.

Alaska Sales Tax

Alaska is one of five states with no state sales tax. However, localities can levy sales taxes, which can reach 7.5%. Higher rates are found in locations that lack a property tax. But, according to the Tax Foundation, the statewide average is only 1.76%.

Alaska Real Property Taxes

In Alaska, the median property tax rate is $1,212 per $100,000 of assessed home value.

Alaska Property Tax Breaks for Retirees

Homeowners 65 and older (or surviving spouses 60 and older) are exempt from municipal taxes on the first $150,000 of assessed value of their property.

Alaska Motor Fuel Taxes

Gasoline: 15.13¢ per gallon.
Diesel: 14.98¢ per gallon

Both of these fuel tax rates are the lowest in the country.

Alaska Sin Taxes

Cigarettes: $2 per pack; many localities add steep taxes (Juneau's is $3 per pack)
All other tobacco products: 75% of the wholesale price
Vapor products: No statewide tax, but several localities impose one

Beer: $1.07 per gallon
Wine: $2.50 per gallon
Liquor: $12.80 per gallon

Marijuana: $50 per ounce for mature bud/flower, $15 per ounce for trim, $25 per ounces for bud/flower that is considered immature or abnormal. Clones are taxed at a flat rate of $1 per clone.

Alaska Estate and Inheritance Taxes

No estate or inheritance tax.

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