The five states with no sales tax

The five, and what each charges in the same place instead

Alaska, Delaware, Montana, New Hampshire, Oregon. That is the list, and it has been the same list for decades. What follows it is the part that decides money.

Alaska — nothing at state level — the revenue comes from oil and gas.

Delaware — a Gross Receipts Tax on businesses, charged on total revenue with no deduction for the cost of goods sold.

Montana — nothing general — property and income tax carry it.

New Hampshire — a Meals & Rooms (Rentals) Tax on prepared meals, lodging and vehicle rentals — paid by the consumer, and by far the highest single rate on this page, at 8.5%.

Oregon — a vehicle use tax on new vehicles bought outside the state, payable before the car can be titled and registered.

Read those five lines and the pattern is unmistakable: none of them simply collects less. Delaware moved the charge from the buyer to the seller, which changes who writes the cheque and not who pays it — a gross receipts tax lands in the price like any other cost. New Hampshire kept a sales tax on precisely the things a visitor buys — a meal, a bed and a hire car. Oregon kept one on cars bought elsewhere. Only Alaska and Montana genuinely leave the space empty at state level, and both let localities fill it.

Against a median state rate of 6% across the states whose own documents we have read, and 7.25% at the top, avoiding the state layer entirely is worth real money — $2,400 a year on $40,000 of taxable spending at the median. The question is what the state takes from you somewhere else to make up for it.

"No sales tax" is not always true at the till

Two of the five have no state sales tax and a local one anyway, which is the single most useful thing on this page and the thing the lists leave out.

Alaska. Boroughs and cities levy their own sales taxes, and each decides for itself whether food is taxed, so an Alaskan address can still carry a sales tax bill.

Montana. A handful of resort communities levy a local resort tax on certain goods and services.

So an address in one of those two can carry a sales tax bill that an address forty miles away does not, and neither address is in a state with a sales tax. If you are choosing where to live on this basis, the state is the wrong unit — the borough or the town is.

The three that really do charge nothing anywhere are Delaware, New Hampshire, Oregon. In those, a price on a shelf is the price you pay, which is disorienting the first time if you have lived anywhere else.

The overlap with no income tax is almost empty, and that is the whole point

Nine states charge no income tax. Five charge no general sales tax. The two lists share exactly one name: Alaska — and Alaska's boroughs levy sales taxes of their own, so even that one is qualified.

That near-zero overlap is not a coincidence, it is arithmetic. A state runs on three big taxes — income, sales and property — and giving up one means leaning harder on the other two. Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming give up income tax, and most of them have a sales tax, a heavy property tax, or both.

Alaska can do without both because oil and gas revenue does the work that taxes do elsewhere, which is a position no other state is in and not one any state can choose.

The practical consequence: "low tax state" is not a property a state has. It is a property of the fit between a state's mix and your own — what you earn, what you own and what you spend. A page that ranks states without knowing those three things about you is ranking something else.

What avoiding the state sales tax is actually worth

Sales tax is the one big tax that scales with spending rather than with income or assets, which makes its burden fall hardest on households that spend most of what they earn.

On $40,000 of taxable spending a year, the state layer alone costs $1,160 in the cheapest state that charges one and $2,900 in the dearest — before any county or city rate on top, which in some states roughly doubles it.

That is a real saving and it is smaller than most people assume, for a reason worth knowing: groceries and clothing are where the money goes, and many states already exempt one or both. 28 of the states with a sales tax exempt groceries from the state rate entirely. So the comparison is not the headline rate against zero; it is the rate on what you actually buy against zero.

Which is why the honest answer to "should I move for this" is almost always no on its own, and sometimes yes in combination — a state with no sales tax and no income tax would be decisive, and only Alaska is both.

And in the states that do charge one, the headline rate is not the rate

Comparing a no-sales-tax state against one that charges 7.25% makes the gap look enormous, and two things in the data shrink it.

First, groceries. Of the 45 states with a sales tax whose own documents this site has read, 28 exempt food from the state rate entirely, 8 charge a reduced rate on it and only 2 tax it at the full rate; the remaining 7 exempt it from the state rate while letting localities tax it. Food is the largest single line in most household budgets, so a state that exempts it has already given back the part of the tax that hurts most.

Second, local rates on top, which run the other way. In 34 of them counties and cities add their own, and where that stacking is steepest it reaches 8.3% on top of the state rate — more than the entire state rate in most places. A state rate quoted on its own is a floor, not a price.

So the honest comparison for someone weighing a move is not 7.25% against zero. It is what the tax costs on your basket, in your town, against zero — and the gap that survives that is usually a third to a half of the headline.

Clothing is the other exemption worth knowing, because it is rarer and more valuable than people assume: Pennsylvania, New Jersey, Minnesota, Vermont exempt it outright, and New York, Massachusetts, Rhode Island exempt it below a price threshold.

Where the money comes from in a state with no sales tax

A state budget does not shrink because one of its three big taxes is missing. It is made up elsewhere, and the pattern in these five is consistent enough to be predictive.

Alaska is the outlier and cannot be copied. Oil and gas revenue funds the state, which is why it manages without either a sales tax or an income tax — the only state in the union in that position. It is not a policy choice other states could make; it is a geological one.

New Hampshire leans on property, and hard. Its median county effective property rate of 1.98% is the 3rd highest of the 51 states measured here, against a national median of 0.84%. That is the mechanism that lets a state with no sales tax and no income tax pay for itself. Someone moving there for the tax should be comparing property bills, not sales receipts.

Delaware moved the charge rather than dropping it. Its gross receipts tax is levied on the seller instead of the buyer, and a tax on a seller's total revenue with no deduction for the cost of goods sold behaves, at the till, a great deal like a tax on the sale. What changes is that it is invisible: there is no line on the receipt, so the price simply is what it is.

Oregon leans on income. On $120,000 single its state income tax is $9,161 — the highest of the 51 jurisdictions this site computes. With no sales tax to soften it, that makes Oregon unusually favourable to households that spend a lot relative to what they earn, and unusually expensive for high earners — the exact mirror image of the nine states with no income tax.

Montana spreads it. Its income tax on $120,000 is $5,419 and its median county property rate is 0.71%, below the national median — neither extreme, which is why it rarely appears at the top or the bottom of any ranking.

Read those five and the lesson generalises: the tax a state does not charge tells you which tax it charges hardest. That is the single most useful thing to take from any list of this kind, including this one.

And if you are not moving to one of the five, where is it lowest

Most people asking this question are not going to move to Alaska. The useful version is which states charge least, and the state layer alone ranks like this — lowest first, of the 45 whose own documents this site has read:

1. Colorado — 2.9%, plus up to 8.3% locally.

2. New York — 4%, plus up to 4.88% locally.

3. Georgia — 4%, plus up to 5% locally.

4. Alabama — 4%, plus up to 7% locally.

5. Hawaii — 4%, plus up to 0.5% locally.

6. Wyoming — 4%, plus up to 4% locally.

7. South Dakota — 4.2%, plus up to 2% locally.

8. Missouri — 4.23%, plus up to 6% locally.

9. Virginia — 4.3%, plus up to 2.7% locally.

10. Oklahoma — 4.5%, plus up to 7% locally.

11. North Carolina — 4.75%, plus up to 2.75% locally.

12. Utah — 4.85%, plus up to 4% locally.

13. New Mexico — 4.88%, plus up to 3.5% locally.

14. Wisconsin — 5%, plus up to 0.9% locally.

15. Louisiana — 5%, plus up to 7% locally.

16. North Dakota — 5%, plus up to 3% locally.

17. Maine — 5.5%.

18. Nebraska — 5.5%, plus up to 2% locally.

19. Arizona — 5.6%, plus up to 5% locally.

20. Ohio — 5.75%, plus up to 2.25% locally.

Look at the second half of those lines rather than the first. A low state rate with a high local ceiling is not a low sales tax, and several of the states near the top of that list have exactly that shape — the state collects little and lets its counties collect a great deal, which produces a flattering headline and an ordinary receipt.

The sales tax calculator runs the combination for a specific place, which is the only figure that settles it.

Where these came from, including the three that would not answer

Each of the five is read off that state's own revenue department, with the date:

Alaska — Alaska Department of Revenue, Tax Division, Tax Types administered by the Division — no general sales tax among them. Read 2026-09-14. https://tax.alaska.gov/programs/whatsnew.aspx

Delaware — Delaware Division of Revenue, Gross Receipts Tax FAQs — rates from 0.0945% to 1.9914%, and up to 2.4218% on petroleum products. Read 2026-09-22. https://revenue.delaware.gov/services/business-tax/gross-receipts-tax/

Montana — Montana Department of Revenue, Sales Tax Guidance for Montana Business and Residents — "Montana does not have a general-use sales tax". Read 2026-09-16. https://revenue.mt.gov/taxes/general-sales-tax

New Hampshire — New Hampshire Department of Revenue Administration, Taxes at a Glance, and Meals & Rooms (Rentals) Tax — 8.5% for taxable periods beginning 1 October 2021. Read 2026-09-22. https://www.revenue.nh.gov/taxes-glance/meals-rooms-rentals-tax

Oregon — Oregon Department of Revenue, Sales Tax in Oregon — "Oregon doesn’t have a general sales or use/transaction tax". Read 2026-09-22. https://www.oregon.gov/dor/programs/businesses/Pages/sales-tax.aspx

Three of those dates are recent, and the reason is worth saying. New Hampshire, Delaware and Oregon sat on this site's list of unread states for weeks: their own websites refused every request made while the sales tax data was being gathered. "New Hampshire has no sales tax" is common knowledge, and common knowledge is not a source — publishing a zero we had not read would have been the same mistake as publishing any other unverified figure. They were retried until they answered, and this page is what they said.

And what this page does not do: it does not rank the fifty states by total tax burden. That figure depends on your income, your house and your spending, and a single ranking would be averaging over households that face opposite answers. The state comparison runs your own salary instead.

Questions

Which states have no sales tax?

Alaska, Delaware, Montana, New Hampshire, Oregon — five, and the list has been stable for decades. But Alaska and Montana allow local sales taxes, so an address in either can still carry one. Only Delaware, New Hampshire, Oregon charge nothing anywhere.

Does Alaska really have no sales tax?

No state sales tax, which is not the same thing. Alaska's Department of Revenue administers no general sales tax, but boroughs and cities levy their own and each decides for itself whether food is taxed. Whether you pay one in Alaska depends on which borough you are standing in.

What does Delaware charge instead of sales tax?

A Gross Receipts Tax on businesses — charged on a company's total revenue with no deduction for the cost of goods sold, at rates from 0.0945% to 1.9914% depending on the activity, and up to 2.4218% on petroleum products. Its own Division of Revenue says the tax is "levied on the seller of goods or services, rather than on the consumer", which changes who writes the cheque rather than who ultimately pays it.

Is New Hampshire really tax free?

It has no general sales tax and, since the 2025 tax year, no income tax of any kind either. What it does have is a Meals & Rooms (Rentals) Tax of 8.5% on prepared meals, lodging and vehicle rentals — paid by the consumer — and some of the highest property tax rates in the country. The money comes from somewhere.

Which states have both no sales tax and no income tax?

One: Alaska. Nine states charge no income tax and five charge no general sales tax, and Alaska is the only name on both lists — because oil and gas revenue does the work taxes do elsewhere. Even there, boroughs levy sales taxes of their own.

How much would I save with no sales tax?

On $40,000 of taxable spending a year, the state layer alone runs from $1,160 to $2,900 depending on the state, before county and city rates that in places roughly double it. Less than the headline rate suggests, though, because many states already exempt groceries — the comparison is the rate on what you actually buy, not the rate on the sign.