Which states are the best to live in tax-wise? It’s not so easy to determine because each state has its own tax structure. But The Tax Foundation reviews the states and each year they rank them based on all the taxes that are paid by businesses and residents. Such information would be especially helpful for business leaders, taxpayers and even government policymakers to compare the taxation systems.
So for 2015, which state imposes the least taxes?
Unsurprisingly, the states like Florida that do not have individual income taxes are ranked very highly. Other such states are Alaska, Wyoming, Nevada and South Dakota. In fact, Florida is in the top five. Other states namely Washington, Texas, New Hampshire and Tennessee do not impose income tax but do charge taxes on other forms of income. So these states are placed in the top ten but not top five.
Here are the top ten tax-friendliest states for 2015:
2. South Dakota
7. New Hampshire
Most of these states do not charge one or more of the three major taxes – individual income tax, corporate tax and sales tax. For instance, Wyoming, Nevada, and South Dakota have no corporate or individual income tax whereas Alaska does not levy income or state-level sales tax. Florida does not charge individual income tax and New Hampshire and Montana have no sales tax.
But two of the top ten states do impose all three major taxes. They are Utah and Indiana. These states have all three major taxes but the rates are very low and broad-based.
Want to know which states ranked the lowest? Find out more about the most and least tax-friendly states in 2015.