States With No Income Tax
> 2016 personal income per capita: $50,640 (14th highest)
> 2016 total state tax collections per capita: $3,060 (16th highest)
> 2015 state debt per capita: $4,495 (12th highest)
> Largest source of tax revenue: Sales tax (45.9% of total)
Washington compensates for missed income tax revenue with some of the highest sales and excise tax rates in the country. The state levies a 6.5% general sales tax, a higher rate than the vast majority of states. Additionally, the state has the highest excise tax on gasoline and by far the highest excise tax on spirits of any state. Partially as a result, 45.9% of state revenue comes from sales taxes, the largest share of any state.
Though Washington does not have a corporate income tax either, the state does levy a gross receipts tax on businesses, collecting 0.47% of annual gross income of businesses in the state.
> 2016 personal income per capita: $55,183 (4th highest)
> 2016 total state tax collections per capita: $3,272 (12th highest)
> 2015 state debt per capita: $1,424 (5th lowest)
> Largest source of tax revenue: Property tax (36.7% of total)
Much like Alaska and Texas, part of the reason Wyoming can afford not to levy an income tax is because of the revenue it generates from its natural resources. Energy-related mining and mineral extraction is the largest industry in Wyoming, and the state government levied taxes on over $10 billion in oil, natural gas, coal, and other mineral extraction in 2017. Severance tax rates on those resources range from 2% to 7%. Companies paying the most in severance tax in Wyoming include global conglomerates Exxonmobil and British Petroleum.
Wyoming also has a relatively low sales tax rate, and partially as a result, property taxes account for 36.7% of state tax revenue, the largest share of any revenue source.