States with the highest sales tax

The state with the highest sales tax is not the one with the highest rate

California has the highest state sales tax in the country at 7.25%, and it is the answer almost every list gives.

The highest rate anyone actually pays is somewhere else. Arkansas permits local sales tax up to 6% on top of a state rate of 6.5%, so a purchase there can carry 12.5% — 5.25 points more than California's headline.

And the state with the highest rate is not the most expensive place to shop either. On $100 of groceries the dearest state here is South Dakota at $6.20, because it taxes food at the full rate — while California, with the country's highest state rate, charges $0.00 on the same basket.

Three rankings, three different states at the top. The one that matters to you is decided by what you buy and which county you buy it in.

Highest by combined rate — the figure on the receipt

State rate plus the highest local rate the state permits, for the 34 states whose ceiling this site has read:

1. Arkansas — up to 12.5% (6.5% state plus up to 6% local).

2. Louisiana — up to 12% (5% state plus up to 7% local).

3. Kansas — up to 11.5% (6.5% state plus up to 5% local).

4. Oklahoma — up to 11.5% (4.5% state plus up to 7% local).

5. Colorado — up to 11.2% (2.9% state plus up to 8.3% local).

6. Alabama — up to 11% (4% state plus up to 7% local).

7. Illinois — up to 11% (6.25% state plus up to 4.75% local).

8. Arizona — up to 10.6% (5.6% state plus up to 5% local).

9. Washington — up to 10.5% (6.5% state plus up to 4% local).

10. Missouri — up to 10.225% (4.225% state plus up to 6% local).

11. Minnesota — up to 9.875% (6.875% state plus up to 3% local).

12. Tennessee — up to 9.75% (7% state plus up to 2.75% local).

13. California — up to 9.25% (7.25% state plus up to 2% local).

14. Georgia — up to 9% (4% state plus up to 5% local).

15. South Carolina — up to 9% (6% state plus up to 3% local).

16. New York — up to 8.875% (4% state plus up to 4.875% local).

17. Utah — up to 8.85% (4.85% state plus up to 4% local).

18. Nevada — up to 8.375% (6.85% state plus up to 1.525% local).

Notice how many of those have unremarkable state rates. 3 of the eight highest combined rates belong to states charging under 5% at state level — Oklahoma at 4.5%, Colorado at 2.9%, Alabama at 4%. The tax is there; the state is simply not the one levying it.

Highest by state rate — the ranking that gets published

For comparison, the same states ranked the usual way:

1. California — 7.25%, up to 9.25% combined.

2. Tennessee — 7%, up to 9.75% combined.

3. Indiana — 7%, local ceiling not read here.

4. Mississippi — 7%, local ceiling not read here.

5. Rhode Island — 7%, local ceiling not read here.

6. Minnesota — 6.875%, up to 9.875% combined.

7. Nevada — 6.85%, up to 8.375% combined.

8. New Jersey — 6.625%, local ceiling not read here.

9. Washington — 6.5%, up to 10.5% combined.

10. Kansas — 6.5%, up to 11.5% combined.

11. Arkansas — 6.5%, up to 12.5% combined.

12. Connecticut — 6.35%, local ceiling not read here.

13. Texas — 6.25%, up to 8.25% combined.

14. Illinois — 6.25%, up to 11% combined.

15. Massachusetts — 6.25%, local ceiling not read here.

Compare the two lists and barely any state holds its place. A ranking of state rates is a ranking of legislatures; a ranking of combined rates is a ranking of places.

The state rate is a floor, and in places it is less than half the price

Almost every published ranking of sales tax by state ranks the state rate, and in 34 states that is not the rate anyone pays. Counties, cities and special districts add their own on top, and the ceiling varies more than the state rate does.

The widest gap is Colorado: a state rate of 2.9% and up to 8.3% more locally, so the same purchase can carry 2.9% or 11.2% depending on which side of a line it happens on.

That is why a state-rate ranking inverts. 4 of the ten states with the lowest state rates fall outside the cheapest twenty once local tax is counted, Oklahoma furthest of all — near the top by state rate and 32nd of 34 by combined.

The rate on your receipt is set by your address, not by your state. The sales tax calculator takes both layers.

A high rate that exempts food can cost less than a low one that does not

This is the reversal that makes rate rankings misleading in both directions, and it is easiest to see on the thing everyone buys.

South Dakota — $6.20 of tax on $100 of groceries, on a state rate of 4.2%.

Tennessee — $6.00 of tax on $100 of groceries, on a state rate of 7%.

Hawaii — $6.00 of tax on $100 of groceries, on a state rate of 4%.

Mississippi — $5.00 of tax on $100 of groceries, on a state rate of 7%.

Alabama — $4.00 of tax on $100 of groceries, on a state rate of 4%.

Utah — $3.75 of tax on $100 of groceries, on a state rate of 4.85%.

Missouri — $3.23 of tax on $100 of groceries, on a state rate of 4.225%.

Georgia — $2.00 of tax on $100 of groceries, on a state rate of 4%.

Against that, 30 states charge nothing at all on the same basket, and the highest state rate among them is 7.25% in California — higher than the state rate of every state in the list above.

So a household that spends most of its money on food is better off in a high-rate state that exempts it than in a low-rate state that does not, and the published rankings put those two the other way round.

Why a state ends up at the top

States with high sales tax are rarely high-tax states overall. They are states that chose sales tax over the alternatives, and the pattern shows in the other two taxes.

The trade-off everyone assumes is not in the data, and that is worth knowing before you move. The usual claim is that a high sales tax buys you a low income tax. It does not, at the top of this table:

Of the ten states with the highest combined sales tax, only one charges no income tax — Washington. Four of them are in the more expensive half of the country for income tax as well: Kansas, 40th of 51 on $85,000; Oklahoma, 29th of 51 on $85,000; Alabama, 33rd of 51 on $85,000; Illinois, 44th of 51 on $85,000.

So a high sales tax is not reliably the price of a low income tax. Sometimes it is, and sometimes it is simply a state that taxes more of everything — which is the opposite of the reassurance these rankings are usually read for.

The same test run the other way is just as blunt. Of the ten states with the lowest combined sales tax, four are also in the more expensive half for income tax — so a low sales tax does not reliably buy you a cheap state either. The three big taxes move together about as often as they trade off, and a state is only cheap or expensive relative to a particular household.

Where the pattern does hold is local government. The states at the top of the combined ranking are largely states that fund counties and cities through sales tax rather than through property tax or state transfers. The rate is high because it is paying for two governments rather than one, and the state's own share of it is often unremarkable.

Which is why "high sales tax state" is a poor proxy for "expensive state". On $1,000 of taxable purchases the difference between the top and bottom of the combined ranking is $80.00 — meaningful, and smaller than the income tax difference between the same two places at most salaries.

Clothing splits the country a third way

Groceries are the exemption everyone knows about. Clothing is the one that moves a household budget almost as much and appears in nearly no comparison, because it divides the states into three groups that do not line up with either rate ranking.

4 states exempt clothing outright, with no price limit: Pennsylvania, New Jersey, Minnesota, Vermont. In those, a coat and a pair of school shoes carry no sales tax at any price.

3 set a threshold instead — New York, Massachusetts, Rhode Island — and the three do not agree on what a threshold means. In some the exemption applies to every garment under the limit; in others a single item above it makes the whole purchase taxable. The wording matters more than the number, and it is on each state's own page here.

The remaining 38 tax clothing at the full rate.

Put the two exemptions together and the effect is large: a state that exempts food and clothing charges sales tax mainly on things you buy occasionally, while one that taxes both charges it on nearly everything a household spends. Two states with the same rate can be a long way apart on a year's receipts.

What it costs on a single $1,000 purchase

Percentages are easy to shrug at. A sofa, a laptop or a set of tyres is where a sales tax stops being an abstraction, and at the top of the combined ranking $1,000 of taxable goods carries:

1. Arkansas — $125.00 of tax, at up to 12.5%.

2. Louisiana — $120.00 of tax, at up to 12%.

3. Kansas — $115.00 of tax, at up to 11.5%.

4. Oklahoma — $115.00 of tax, at up to 11.5%.

5. Colorado — $112.00 of tax, at up to 11.2%.

6. Alabama — $110.00 of tax, at up to 11%.

7. Illinois — $110.00 of tax, at up to 11%.

8. Arizona — $106.00 of tax, at up to 10.6%.

9. Washington — $105.00 of tax, at up to 10.5%.

10. Missouri — $102.25 of tax, at up to 10.225%.

11. Minnesota — $98.75 of tax, at up to 9.875%.

12. Tennessee — $97.50 of tax, at up to 9.75%.

Against $45.00 in Hawaii at the other end of the table — a difference of $80.00 on one purchase, and that is the whole reason people drive across a state line for a car or an appliance.

It is also why the purchase, not the year, is the right unit for this decision. Sales tax on a year of ordinary spending is a slow leak; sales tax on a car is a single number large enough to change where you buy it. The states at this end of the table are the ones where that calculation most often comes out in favour of the drive.

Which states are not in the combined ranking, and why

The combined figures on this page cover the 34 states whose own documents publish a local range this site has read. The other 11 — New Jersey, Massachusetts, Michigan, Indiana, Maryland, Kentucky, Mississippi, Connecticut, Maine, Rhode Island, District of Columbia — appear in the state-rate table and not in the combined one, because their local ceiling has not been read in a state document.

That is a deliberate omission rather than an oversight. A combined rate assembled from a secondary compilation would slot those states into the ranking at a position nobody could check, and the ranking is the entire point of the page.

4 states are absent altogether for the same reason at state level: Idaho, New Hampshire, Delaware, Oregon. Idaho’s state sites refuse connections from this environment — the Tax Commission and the Legislature alike, as they did when the vehicle data was gathered. Neither the rate nor the treatment of groceries has been read in an Idaho document, and Idaho is one of the few states that taxes food and rebates it through an income tax credit, so guessing would be doubly wrong.

And the 5 states with no general sales tax at all — Alaska, Delaware, Montana, New Hampshire, Oregon — are not in either ranking because they are not in the race. They have their own page, including the two that still let their towns charge one.

Where these figures came from

Every state rate, local range and exemption is read off that state's own revenue department, one state at a time, with the date recorded. The full record for each is on its own page under the sales tax calculator.

The combined figures are ceilings, taken from each state's own published maximum local rate rather than from an average of what districts actually charge. A typical address pays less; some pay the maximum. Where a state publishes no ceiling, it is left out of the combined ranking rather than estimated into it.

Questions

Which state has the highest sales tax?

California has the highest state rate at 7.25%, but the highest rate anyone actually pays is in Arkansas, where local tax can take the total to 12.5%. Most published lists answer the first question and people are asking the second.

What is the highest combined sales tax in the US?

12.5%, in Arkansas — a state rate of 6.5% plus up to 6% of local tax. That is a ceiling rather than a typical bill: it applies where every permitted local levy is in force, and most addresses in the state pay less.

Why is the sales tax higher than the state rate?

Because counties, cities and special districts levy their own on top, and in 34 states they do. Your receipt shows the sum. In several states the local layer is larger than the state rate itself, which is why a ranking of state rates bears little relation to what anyone pays.

Which state is most expensive for groceries?

South Dakota, at $6.20 of tax on $100 of food, because it taxes groceries at the full rate. Its state rate is 4.2% — not among the highest — which shows how little the headline rate says about a weekly shop.

Do high sales tax states have high taxes overall?

Usually not. A high sales tax is normally a choice made instead of a high income tax or a high property tax, not in addition to one — a state budget has to add up. The comparison worth making is all three together against your own income, spending and housing.