Compare state tax rates and rules — on income, ordinary purchases, gas, sin products, property, and more — across the U.S. Go to the Kiplinger Tax Map District Of Columbia Add to State Compare List | View List View State Compare List (0) selected | Compare up to 5 The Bottom Line Not tax friendly Living in the Nation’s Capital can be expensive. Though property and sales taxes are unexceptional, the District of Columbia takes huge bite of income. Taxable income over $40,000 is taxed at a steep 6.5% tax rate (the top rate of 8.95% is reserved for taxable income over $1,000,000). Sales Tax 5.75% Income Tax Range Low: 4% (on taxable income up to $10,000)High: 8.95% (on taxable income above $1,000,000) See Kiplinger.com’s Retiree Tax Map Map to learn how the District of Columbia taxes Social Security income and other forms of retirement income. Motor Fuel Taxes Gasoline: $0.24 per gallon. Diesel: $0.24 per gallon. Property Taxes Median property tax on District of Columbia’s median home value of $506,100 is $2,811.See Kiplinger.com’s Retiree Tax Map for details on tax breaks for seniors in the District of Columbia. Vehicle Taxes Drivers pay an excise tax — when a new vehicle is first registered in the District — that ranges from 6% to 8%, depending on the vehicle’s weight. Sin Taxes Cigarettes and little cigars: $4.50 per packOther tobacco products: 96% of the wholesale priceBeer: $0.70 per gallonWine: $1.73 per gallonLiquor: $6.17 per gallon Vapor products: 96% of the wholesale price. Travel Taxes Hotel: D.C. charges a 14.5% lodging tax for hotels and transient accommodations in lieu of sales tax.Rental cars: The District levies a 5.75% tax on rental cars, and sales tax is also collected. Commercial parking is taxed 18%. Taxes On Wireless Service 11.83% Inheritance and Estate Taxes Estates valued over $5.6 million are subject to estate tax. Rates range from 8% to 16%. Oddball Tax Businesses in the District that sell food or alcohol are required to charge a 5-cent fee for each paper or plastic disposable bag they give to a customer. The store gets to keep a penny, and the balance goes to a government fund dedicated to cleaning up the Anacostia River. About our methodology