Finance1 min read

Where Each U.S. State Gets Its Tax Revenue From

By · Published by Everything Blog

In short

Recent data from the U.S. Census Bureau reveals distinct geographic patterns in how state and local governments secure their operating funds. Jurisdictions lacking individual income taxes frequently turn to real estate levies and retail receipts, which generate around 75% or more of all tax revenue in areas like Texas and Florida. Meanwhile, states like Delaware utilize their corporate legal standing to draw a third of their funding from business license taxes.

Key points

  • Property taxes serve as the primary revenue generator for state and local collections acr…: Property taxes serve as the primary revenue generator for state and local collections across twenty-five states.
  • Individual income taxes lead overall collections in just seven states, including Californ…: Individual income taxes lead overall collections in just seven states, including California, Maryland, and Oregon.
  • States without personal income taxes rely on property and sales taxes for roughly three-q…: States without personal income taxes rely on property and sales taxes for roughly three-quarters or more of their revenue.

Sources checked by our analysis pipeline: 1

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How the 50 States Generate Their Tax Revenue

Key Takeaways

- Property taxes are the largest individual tax category in 25 states, including Florida, Texas, and New York.

- Washington collects nearly half of its combined state and local tax revenue from general sales and gross receipts taxes.

- Delaware stands out for license taxes, reflecting its role as a legal home for businesses.

From paychecks and purchases to homes and businesses, states rely on different combinations of taxes to fund public services.

This graphic breaks down combined state and local tax revenue across all 50 states using 2024 government finance data from the U.S. Census Bureau. The percentages show each category’s share of tax collections, excluding federal taxes and funding such as federal grants.

Property Taxes Lead in Half the Country

Property taxes are the largest revenue source in half of U.S. states, with particularly high shares in New Hampshire (64.3%), Alaska (42.4%), and Texas (41.1%). General sales and gross receipts taxes lead in 16 states, while individual income taxes top the list in seven.

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