Explanation of national consumption tax: Main differences from income tax
In the United States, sales tax is levied in the form of retail sales tax, excise tax, and customs duties.
Retail sales taxes are a major source of revenue for most states in the United States, and only five states do not impose a statewide sales tax.
In addition to the statewide sales tax, many local governments also impose local sales taxes that help fund local government services.
These sales taxes are common in most states, but some may be higher than others.
Louisiana has the highest state and local sales tax rates in the country
According to the Tax Foundation, Louisiana has the highest combined state and local sales tax rate in the country and the second-highest average local sales tax rate in the United States.
Louisiana ranks 32nd in state sales tax alone at 5.0%, but the average local sales tax rate is 5.11%, and the combined state and local sales tax rate is 10.11%.
By comparison, the national average combined sales tax rate is 7.53%, but the state with the lowest combined sales tax is 1.82%.
Louisiana is the most recent state to increase its sales tax rate, which will increase from 4.45% to 5% in January 2025, according to the Tax Foundation.
States with the highest and lowest sales taxes
Here are the states with the highest and lowest combined average state and local sales tax rates, according to the Tax Foundation.
- Louisiana: 10.11%
- Tennessee: 9.61%
- Washington: 9.51%
- Arkansas: 9.46%
- Alabama: 9.46%
- Oklahoma: 9.06%
- California: 8.99%
- Illinois: 8.96%
- Kansas
- new york
- arizona
- missouri
- nevada
- texas
- minnesota
- colorado
- new mexico
- georgia
- south carolina
- Utah
- ohio
- north dakota
- mississippi
- Rhode Island (tie)
- Indiana (tie)
- north carolina
- nebraska
- florida
- iowa
- new jersey
- west virginia
- vermont state
- connecticut
- pennsylvania
- Massachusetts
- south dakota
- idaho
- Michigan (tie)
- Kentucky (tied)
- Maryland (tie)
- virgin
- wisconsin
- wyoming
- maine
- Hawaii
- alaska
New Hampshire, Delaware, Oregon, and Montana are not included in the ranking because they do not have state and local sales tax rates.
Presley Beau Tyler is a reporter for USA Today’s Louisiana Deep South Connect team. X Find her at @PresleyTyler02 and email her at PTyler@Gannett.com.
