People who shop in California or Indiana feel the pinch of state sales taxes ranging from 7.25% and 7.00%, respectively. These are two of the states with the highest sales taxes. If you choose to move to another state to avoid the higher prices for everything you buy, you may pay higher prices for some of the products, but you will save by the lower sales tax they charge at the time of the sale. Here are 10 states with the lowest sales taxes in the United States.
10. Georgia Sales tax: 4%
Residents and visitors to the state of Georgia pay a state sales tax of 4%. That’s the lowest rate you will pay when shopping in any of its cities. you should prepare to pay at least double that amount, due to the local taxes imposed. Jurisdictions have exercised their right to vote-in special local taxes to support their local economies. The highest combined sales tax in Georgia is 9%, depending on the jurisdiction, for 2022.
9. Hawaii Sales tax: 4%
Avalara confirms that the state sales tax in Hawaii is 4% as of 2022. Some jurisdictions, such as Honolulu impose an additional sales tax of .5% for a total of 4.5% added to your bill when you shop or conduct business. It’s the ninth lowest state in terms of state and local sales taxes.
8. New York Sales tax: 4% plus additional local taxes
New Yorkers and visitors to the city are charged a sales tax rate of 4%. This is the base sales tax cost that is added with the tax rates imposed by various jurisdictions, upon approval. The jurisdictions include city, county, and school districts that may have voted in additional local taxes. The cost varies from one area to another and is subject to change from one year to the next. Residents and visitors to New York should look up the local tax rates for the specific jurisdiction in which they plan to shop and do business.
7. Wyoming Sales tax: 4%
Residents of Wyoming and visitors to the state pay a 4% sales tax for most items purchased. It’s the average cost of doing business in the state, but by the time some other local option sales taxes are added, you can end up paying up to 5.436%. The reason for the differences from one jurisdiction to another is that cities are allowed to vote in, additional taxes to help support their local economies. The highest combined sales tax in the state for 202 is 6%, which is still lower than in some states. Plan to pay the highest rates in Jackson, Casper, Sheridan, Laramie, Cheyenne, and 72 more cities in these areas.
6. Colorado Sales tax: 2.90% with variations
The Colorado Department of Revenue explains that the tax rates for the state changed, effective July 1, 2022. Previously the state sales tax was 2.90% with local taxes of 4.73% for a combined total of 7.63%. New taxes are charged at different rates, depending on the jurisdiction. Burlington has a tax rate of 3% with some exemptions, with a use tax of 3%. Grover charges a 1% tax rate with a 1% use rate. La Junta charges a 3% tax rate with a 3% use tax. Crowley charges a 2% county tax, and Sedgwick charges a 3% county tax with exemptions added. The Delta County Memorial Health Service District charges a 0.80% tax. It’s a confusing schedule, but the average person will pay 2.90% in taxes.
5. Alaska Sales tax: 0%
World Population Review confirms that five states charge zero sales tax for most purchases. Alaska is among them, but it does pay an average of 1.43% for local sales taxes. Even with the added expense, its total combined sales tax rate is still lower than all but four other states in the USA. Alaska would be hard-pressed to vote in any new state or local taxes because the cost of living is ridiculously high in most areas already. Most goods are more expensive because they must be imported into remote locations as Alaska is off the beaten path for commerce.
4. New Hampshire Sales tax: 0%
New Hampshire is another of the five states that do not charge a sales tax. Unlike Alaska, there are no local taxes imposed either. Residents are accustomed to paying the sticker price for the goods they purchase. When the locals travel to other nearby states such as Delaware, the rules are the same, but venturing into neighboring New York is another story. They charge a state sales tax that adds 4% to the cost of most purchases. The taxes go even higher in Maine or Vermont. New Hampshire is one of the better states for sales tax on the Eastern Seaboard.
3. Montana Sales tax: 0%
Avalera reports that Montana does not have a state sales tax, nor does it have any local taxes. If you’re fortunate to live in this beautiful part of the country that is home to portions of the Rocky Mountains, you can count on paying the sticker price. Montana residents encounter a culture shock when they shop in neighboring states that do not offer them the same courtesy.
2. Delaware Sales tax: 0%
The Tax Foundation confirms that Delaware is a state that does not charge a state sales tax, nor does it charge local sales taxes. When you purchase items in the grocery stores and department stores in this state, you can be certain that you will only pay the sticker price. Delaware is a pleasant state for shoppers because there is no need to try to calculate how much the tax will be on any given item.
1. Oregon Sales tax: 0%
The state sales tax and local tax levies are zero for residents and shoppers in the state of Oregon. It’s one of the cheapest places to live, minus its sales tax, unlike its neighbor Washington State with a combined rate of 9.17%. Many people who live on the border of Oregon and Washington, or California and Oregon, cross state lines to save a few bucks on their weekly grocery purchases. Californians pay a combined rate of 8.56% for their purchases. It’s understandable why people who live on the border, or near would make the journey for their weekly grocery trips or clothing and other items.