As per Taxlawsinusa, Sales tax rates vary widely across the United States, and they can significantly affect your purchasing power. While some states impose high sales taxes, others have relatively low rates or even no sales tax at all. In this article, we will explore the states and cities with the lowest sales tax rates, provide insights into what this means for consumers, and help you understand the broader implications of these tax policies. Whether you’re a resident or a tourist, knowing where the lowest sales tax rates are can make a big difference. Here are the sales tax rates by state in the USA:
– Highest Sales Tax Rates:
– Louisiana: 9.56% (4.45% state tax + 5.11% average local tax)
– Tennessee: 9.55% (7% state tax + 2.55% average local tax)
– Arkansas: 9.45% (6.5% state tax + 2.95% average local tax)
– Washington: 9.38% (6.5% state tax + 2.88% average local tax)
– Alabama: 9.29% (4% state tax + 5.29% average local tax)
– Lowest Sales Tax Rates:
– Alaska: 1.82% (0% state tax + 1.82% average local tax)
– Hawaii: 4.5% (4% state tax + 0.5% average local tax)
– Wyoming: 5.44% (4% state tax + 1.44% average local tax)
– Maine: 5.5% (5.5% state tax + 0% average local tax)
– Wisconsin: 5.7% (5% state tax + 0.7% average local tax)
– State Sales Tax Rates:
– California: 7.25%
– Indiana, Mississippi, Rhode Island, and Tennessee: 7%
– Colorado: 2.9%
– Alabama, Georgia, Hawaii, New York, and Wyoming: 4%
Please note that local sales tax rates can vary within a state, and these rates are subject to change. For the most up-to-date information, you can visit the Avalara website, which provides a sales tax calculator and tax rate lookup tool.
Which State in the USA Has the Lowest Sales Tax?
States With the Lowest Sales Tax Rates
As of 2025, several states in the USA have some of the lowest sales tax rates, providing financial relief for consumers who want to save money on their purchases. The following states are known for their low or zero sales tax rates:
1. Alaska
Alaska is well-known for having no statewide sales tax, which means that residents and visitors alike don’t have to pay any state-imposed sales tax on most goods and services. However, some localities within the state do impose their own sales tax, so it’s essential to check local tax rates.
2. Delaware
Delaware is another state with no state sales tax, making it an attractive destination for shoppers. Although Delaware imposes no sales tax on purchases, it does have a higher-than-average income tax, so this tax advantage may be offset by other taxes.
3. Montana
Montana also does not charge a state-level sales tax, although some local jurisdictions may apply their own sales taxes. It’s an attractive location for shopping, especially for large purchases, as you won’t be hit with sales tax at checkout.
4. New Hampshire
New Hampshire is another state with no sales tax. This state is known for its favorable tax environment, and its lack of a sales tax on goods and services is one reason why many residents and visitors flock to New Hampshire for their shopping needs.
5. Oregon
Oregon also does not charge a state sales tax, making it an excellent place for shoppers looking to avoid high sales taxes. It’s one of the most tax-friendly states for consumers looking to save on goods and services.
Learn more about taxes in the USA.
Which US City Has No Sales Tax?
Cities That Benefit from No Sales Tax
While most cities in the U.S. have sales tax, some offer a tax-free environment or have lower-than-average sales tax rates. Here are a few cities that stand out for having no local sales tax:
- Anchorage, Alaska – Although Alaska does not have a state sales tax, Anchorage imposes a local sales tax that is low compared to other cities in the U.S.
- Portland, Oregon – With Oregon’s lack of a state sales tax, Portland is a popular shopping destination for both residents and visitors.
- Manchester, New Hampshire – As part of New Hampshire, Manchester enjoys the benefit of no sales tax, making it an attractive city for those seeking a tax-free shopping experience.
Where Is Low Tax in the USA?
Best States for Low Tax Rates
If you’re looking for states with low overall tax rates, including sales tax, income tax, and property tax, consider the following:
- Wyoming – Known for its low sales tax rates and favorable income tax laws, Wyoming is often ranked as one of the best states for low taxes.
- South Dakota – With no income tax and a relatively low sales tax rate, South Dakota is a tax-friendly state for both individuals and businesses.
- Florida – Florida not only has no income tax but also offers low sales tax rates, making it an attractive option for tax-conscious individuals.
What Is the Lowest US Income Tax Rate?
A Look at Income Tax Rates
While some states have low or no sales taxes, others offer low income tax rates. States like Wyoming, South Dakota, and Florida have no state income tax at all, which is particularly appealing for residents who want to save on taxes. Conversely, states like California and New York impose higher income tax rates to fund public services and infrastructure.
The lowest state income tax rate is generally found in Alaska, where there is no state income tax, or in states like Texas and Florida, which also don’t impose any state income tax.
Check out the 2025 state income tax rates.
Sales Tax Rates in Major Cities, Midyear 2025
As of midyear 2025, the following cities are expected to have some of the lowest sales tax rates in the country:
1. Cheyenne, Wyoming
Cheyenne, Wyoming, has a sales tax rate of just 4%, making it one of the lowest in the nation. Additionally, Wyoming has no state income tax, which adds to the overall tax relief for residents.
2. Anchorage, Alaska
While Anchorage imposes a local sales tax, it remains one of the most tax-friendly cities due to Alaska’s lack of a statewide sales tax. The local sales tax is typically lower than the national average, making it an appealing option for residents and visitors alike.
3. Portland, Oregon
Portland, Oregon, stands out with no sales tax at all. This city is an ideal destination for shoppers looking to make large purchases without the additional burden of sales tax.
State and Local Sales Tax Rates, 2025
National Overview of Sales Tax Rates
In 2025, the sales tax rates vary significantly across states and localities. While the federal government does not impose a sales tax, states and local governments use it as a means of generating revenue. The national average sales tax rate is around 7.12%, but states like California and Tennessee can have rates as high as 9.55% or more.
On the other hand, states like Alaska, Delaware, and Montana continue to provide tax relief by not imposing sales taxes, giving residents and visitors significant financial advantages when making purchases.
Explore more about state sales tax rates.
Which States Have the Lowest Sales Tax?
As discussed earlier, several states have notably low or no sales taxes. To recap:
- Alaska
- Delaware
- Montana
- New Hampshire
- Oregon
These states lead the way when it comes to offering low or no sales tax, providing a major benefit for consumers and businesses alike.
Ten States with the Lowest Sales Tax
Based on the 2025 data, here are the ten states with the lowest sales tax rates:
- Alaska (No state sales tax)
- Delaware (No state sales tax)
- Montana (No state sales tax)
- New Hampshire (No state sales tax)
- Oregon (No state sales tax)
- Wyoming (4% sales tax)
- South Dakota (4% sales tax)
- North Dakota (5% sales tax)
- Florida (6% sales tax)
- Idaho (6% sales tax)
These states continue to offer some of the best tax advantages for residents and shoppers in 2025.
Cities with the Highest and Lowest Taxes
Highest Tax Cities
Some cities, particularly in states with high state sales taxes, have some of the highest tax rates in the nation. Cities like Los Angeles, Chicago, and New York City have high local taxes, often pushing the total sales tax rate to over 10%.
Lowest Tax Cities
Conversely, cities like Portland, Anchorage, and Cheyenne offer tax-friendly environments with either no sales tax or significantly lower rates compared to major metropolitan areas.
Understanding where the lowest sales tax rates are in the U.S. can help you make informed decisions about where to live or shop. States like Alaska, Delaware, Montana, New Hampshire, and Oregon offer significant tax relief, while cities like Portland and Cheyenne are ideal for consumers looking to avoid high sales tax. By staying informed about sales tax trends and the best states for low taxes, you can maximize your savings and reduce your financial burden.
For more insights into U.S. taxes and financial planning, visit Tax Laws in the USA.
Internal Links:
External Links: