Texas State Tax Guide
Texas state tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact residents.


Texas state tax: Overview
Texas state tax has pros and cons. The statewide sales tax rate of 6.25% is a bit high, and localities can add an additional 2%. Property taxes in Texas are also on the high end but are still lower than in some other states.
Texas residents might find paying the sales and property taxes worth it since they don't need to pay income tax. Gasoline prices in the Lone Star State are fairly low.
[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Texas income taxes
Texas is one of nine U.S. states with no income tax.
Texas sales tax
Texas has a 6.25% state sales tax rate, but not all items are taxable.
- Groceries are tax-exempt.
- Prescription drugs are tax-exempt.
- Over-the-counter medications are tax-exempt.
- Feminine hygiene and menstrual products are sales tax-exempt as of September 1, 2023.
More from Kiplinger Texas Tampon Tax is Now Eliminated
How much are property taxes in Texas?
In Texas, the average effective property tax rate is 1.74%, which is one of the highest in the U.S. However, some homeowners qualify for property tax breaks.
Texas Property Tax Breaks for Retirees
Homestead Exemption: Homeowners age 65 or older may be eligible for a special homestead exemption for their principal residence. For qualified homeowners, $10,000 of the property's assessed value is exempt from school taxes (in addition to the regular homestead exemption of $40,000). Other taxing units may also offer an exemption of at least $3,000 to qualified homeowners.
Property Tax Freeze: School-district taxes are frozen when a residence's owner turns 65. Counties, cities, towns and junior-college districts can also establish a tax freeze.
Property Tax Deferral: A homeowner who is 65 or older may qualify to defer their property taxes. The deferment period doesn't expire until the 181st day after a qualifying event occurs.
- Moving from the primary residence is a qualifying event.
- Death of the owner is a qualifying event.
Texas motor vehicle and gas taxes
Motor vehicle purchases in Texas are taxable.
The Texas gasoline tax is $0.20 per gallon.
As of September 1, 2023, Texas imposes a "tax" on electric vehicles registered in the state.
Texas taxes on alcohol and tobacco
Cigarettes | $1.41 per pack |
Snuff | $1.22 per ounce |
Chewing tobacco | $1.22 per ounce |
Cigars | $0.01 to $0.15 per cigar |
Beer | $0.20 per gallon |
Wine | $0.20 per gallon |
Sparkling wine | $0.516 per gallon |
Liquor | $2.40 per gallon |
Marijuana | N/A (not permitted for recreational use) |
Texas estate and inheritance taxes
Texas has no inheritance or estate tax.
Related Content

Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.
-
-
Chase Ink Business Cards Launch $900+ Offer
Chase Ink business credit cards offer new bonus amounts, solid cash back and perks.
By Ellen Kennedy Published
-
Why Houses Make for Terrible Wealth Transfer Vehicles
Home may be where the heart is, but after it’s inherited, it’s where heirs have to manage upkeep and deal with family conflicts related to what to do with it. What should parents do instead?
By Kristen Sieffert Published
-
A Little-Known Tax-Free Way To Help Pay Your Student Loan
Student Debt Employers can provide valuable assistance with employee student loan repayments.
By Kelley R. Taylor Published
-
Tax Tips for National Preparedness Month
Disaster Preparedness September is National Preparedness Month. These tips can help you secure important documents and information — before a disaster happens.
By Katelyn Washington Published
-
Places That Now Have More Time To Pay Estimated Tax
Tax Deadlines Estimated tax payments are due soon — September 15 in most cases. But many people have more time to pay the IRS due to natural disasters. Are you one of them?
By Kelley R. Taylor Last updated
-
IRS Announces Florida Tax Relief Following Hurricane Idalia
Tax Deadline In response to the severe damage caused by Hurricane Idalia, the IRS has extended tax deadlines for affected Floridians.
By Kiana Curtis Published
-
Will Your State Rebate Check Be Taxed for 2023?
State Rebates Here's what the IRS says about taxing 'state stimulus checks' and other special state rebates and what it could mean for you.
By Kelley R. Taylor Last updated
-
Most Expensive States for Millionaires in 2023
Income Tax If you earn a lot of money, you may want to avoid these most expensive states for millionaires. Some high earners in these areas could pay income tax rates greater than 50%.
By Katelyn Washington Published
-
Hawaii IRS Tax Deadline Extended After Devastating Wildfires
Tax Relief Some Hawaii tax deadlines have been extended by the IRS following devastating wildfires. Here's what impacted residents should know.
By Kiana Curtis Published
-
Best States for Middle-Class Families Who Hate Paying Taxes
State Taxes Here are the best states for middle-class families with "middle incomes" (due to low tax burdens).
By Katelyn Washington Published