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Discover the 5 States With the Highest Sales Tax Rates

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Published on April 15, 2025

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As Trump’s tariffs have shown us, it can be stressful navigating an economic landscape that’s anything but consistent – and the same thing can be said for sales tax rates. With fluctuating rates and tax rules that shift depending on the states you’re selling to, keeping on top of these legalities can be challenging.

To help your business better comprehend the world of sales taxes, I’ve compiled a list of the top five states with the highest sales tax, so you can adjust your business strategy accordingly.

🚨 Important Note 🚨

Though this piece reveals the states with the highest sales tax rates, my area of expertise does not allow me to offer any legal or tax advice. Instead, I recommend consulting with a financial or legal expert for further assistance.

The Top 5 States With the Highest Sales Tax

In total, 45 states have a statewide sales tax in place, while 38 states have a local sales tax in place. For your convenience, I’ve listed the top five states with the highest combined sales tax:

State	State sales tax rate	Average local sales tax rate	Combined sales tax rate (state & local)
1. Louisiana	5.00%	5.116%	10.116%
2. Tennessee	7.00%	2.556%	9.556%
3. Arkansas	6.50%	2.960%	9.460%
4. Washington	6.50%	2.929%	9.429%
5. Alabama	4.00%	5.427%	9.427%

Louisiana sits in first place, with the highest combined sales tax at 10.116%, because of its high rates across both state and local sales tax. It’s followed by Tennessee (9.556%), Arkansas (9.460%), Washington (9.429%), and Alabama (9.427%), which completes the top five.

Though California has the highest statewide sales tax (7.25%), it doesn’t make the top five due to its low local sales tax (1.552%), putting it in eighth place overall.

For transparency, the above data was taken from Tax Foundation, a non-partisan think tank publishing reports on U.S. tax policies.

💡 Statewide vs local sales tax

Statewide sales tax: The sales tax the government imposes on an entire state.
Local sales tax: The sales tax that a local government imposes on the people who live in a specific area, like a city or county.

What About the States With No Statewide Sales Tax?

There are five states that don’t have sales tax at the state level. These are New Hampshire, Oregon, Montana, Alaska, and Delaware (often referred to as the NOMAD states). So, if you’re selling to customers in any of those five states, or run operations there, you don’t have to worry about collecting or remitting statewide taxes.

However, each state will still have its own taxes to take in consideration. For instance, though Alaska doesn’t have a statewide sales tax, many of its jurisdictions will use a local sales tax instead. Meanwhile, Delaware has no state or local sales tax, but does impose a gross receipts tax on merchants.

Outside of the NOMAD states, the five US states with the lowest combined sales tax rates are: Hawaii (4.5%), Wyoming (5.441%), Maine (5.5%), Wisconsin (5.702%), and Virginia (5.771%).

How Do These Sales Taxes Impact Your Business?

Ultimately, consumers bear the burden of sales taxes, since this tax will be added to their total costs at checkout. Because of this, you may need to review your business strategy depending on some key factors:

Your pricing strategies – You need to take sales taxes into account when pricing your products. If the sales tax significantly increases the cost of a product, consumers may reconsider their purchase decision from your store.
Where you’re selling your products – Sales taxes can also vary depending on the product you’re selling in a specific area. For instance, a high-margin product you’re selling in one state could be impacted by higher taxes in another state you’d like to expand into.

If you need further information on how sales tax rates might impact your sales, please consult a tax professional for expert advice.

Written by:

Holly Choules Writer

Holly Choules is a Writer at Website Builder Expert with a background in researching and crafting engaging content for digital platforms. In previous roles, she has demonstrated her wordsmith skills by writing for public facing brands in a range of industries. After gaining hands-on experience using leading website builders, like Wix and WordPress, she is now keen to share her findings through informative, easy-to-follow articles that help small business owners get online and grow their presence. Since joining the team in 2024 and transitioning into the tech sphere, Holly is passionate about applying her three years of content writing experience and upholding Website Builder Expert’s position as an authoritative source on website builders, ecommerce, and digital marketing.