The 5 States with No Statewide Sales Tax
Five US states levy zero statewide sales tax on retail purchases. If you buy a $500 laptop in Portland, Oregon, you pay $500.00 — no tax added at the register. The same laptop in Los Angeles costs $543.40 at the combined rate of 8.68%.
The five no-tax states are: Oregon, Montana, Delaware, New Hampshire, and Alaska. Each arrived at this position for different historical and economic reasons — and each has important caveats that affect what you actually pay.
| State | Statewide Sales Tax | Local Sales Tax | Key Caveat |
|---|---|---|---|
| Oregon | 0% | 0% | Truly zero — no sales tax anywhere in the state |
| Montana | 0% | 0% (mostly) | Some resort towns charge up to 3% local tax |
| Delaware | 0% | 0% | Has a gross receipts tax on businesses instead |
| New Hampshire | 0% | 0% | Taxes, meals, rooms, tobacco, and rental cars |
| Alaska | 0% | 0–7.5% | ~100 municipalities charge local sales tax |
Oregon — The Purest No-Tax State
Oregon is the cleanest example of a no-sales-tax state. There is no state or local sales tax anywhere in Oregon. No city, no county, no special district charges sales tax on retail purchases. A $1,000 purchase costs exactly $1,000.
Oregon funds its government primarily through income tax — Oregon has one of the higher state income tax rates in the US, reaching 9.9% at the top bracket. The trade-off is explicit: no consumption tax, higher income tax.
What Oregon does tax
- Vehicle privilege tax: Oregon charges a 0.5% tax on new vehicle sales paid by the dealer, not the buyer directly — but it effectively raises the sticker price
- Lodging tax: Hotels and short-term rentals pay a transient lodging tax (rates vary by city)
- Cigarette and tobacco taxes: Among the highest in the nation
- Marijuana: 17% state tax plus up to 3% local option tax
For everyday retail — clothing, electronics, groceries, furniture — Oregon is genuinely tax-free at the register.
Montana — No Tax with Resort Town Exceptions
Montana has no statewide sales tax and no general local sales tax. However, Montana law allows certain resort communities to charge a local option tax of up to 3% to fund tourism infrastructure.
Montana resort towns with local tax
- Big Sky: 3% resort tax on lodging, restaurants, and retail over $100
- Whitefish: 3% resort tax on lodging and some retail
- West Yellowstone: 3% resort tax
- Red Lodge: 3% resort tax
Outside these resort areas — including Billings, Missoula, Great Falls, Bozeman, and Helena — there is no sales tax at all. Montana's resort tax is narrow in scope and generally applies to tourism-related purchases, not everyday grocery or retail shopping.
Montana also has no income tax on Social Security benefits and relatively low property taxes, making it a popular retirement destination despite its cold winters.
Delaware — No Sales Tax, But a Business Gross Receipts Tax
Delaware charges no sales tax on any retail purchase — consumers pay nothing extra at the register. This has made Delaware a popular shopping destination for residents of neighboring Pennsylvania (6%), New Jersey (6.625%), and Maryland (6%).
Delaware funds its government through a gross receipts tax on businesses — a percentage of total revenue rather than income or sales. This is effectively a hidden cost embedded in prices, but it does not appear as a separate line on your receipt.
Delaware's other notable taxes
- Lodging tax: 8% on hotel rooms
- Rental car tax: 4.25% on vehicle rentals
- Realty transfer tax: 4% on real estate transactions (split between buyer and seller)
- Tobacco tax: $2.10 per pack of cigarettes
For retail shoppers, Delaware is genuinely zero-tax. The Christiana Mall in Newark, Delaware, draws shoppers from four states specifically for tax-free shopping on clothing, electronics, and luxury goods.
New Hampshire — No Sales Tax with Notable Exceptions
New Hampshire has no general sales tax but imposes specific taxes on several categories that catch visitors by surprise:
New Hampshire's specific taxes
- Meals and rooms tax: 8.5% — applies to restaurant meals, takeout, hotel stays, and short-term rentals. This is a significant exception — eating out in NH costs more than buying a shirt.
- Tobacco products: $1.78 per pack plus other tobacco taxes
- Rental vehicles: 9% tax on rental cars
- Electricity consumption: Small per-kilowatt-hour charge
For retail shopping — clothing, electronics, groceries, furniture, sporting goods — New Hampshire is completely tax-free. The NH tax-free advantage draws shoppers from Massachusetts (6.25%), Maine (5.5%), and Vermont (6%).
New Hampshire also has no income tax on wages, though it does tax interest and dividends. Combined with no sales tax, this makes NH one of the lowest overall tax burden states in the US.
Alaska — No State Tax, But Local Taxes Vary Widely
Alaska is the most nuanced of the five. The state charges no statewide sales tax, but Alaska law allows boroughs (equivalent to counties) and cities to impose local sales taxes. Roughly 100 Alaskan municipalities charge some form of sales tax, with rates ranging from 1% to 7.5%.
Major Alaska city sales tax rates
| City / Borough | Sales Tax Rate | Tax Factor |
|---|---|---|
| Anchorage | 0% | 1.0000 |
| Fairbanks (city) | 0% | 1.0000 |
| Juneau | 5% | 1.0500 |
| Sitka | 5% | 1.0500 |
| Ketchikan | 6.5% | 1.0650 |
| Kodiak | 6% | 1.0600 |
| Nome | 5% | 1.0500 |
| Wasilla | 2.5% | 1.0250 |
Importantly, Anchorage — Alaska's largest city — charges zero sales tax. This makes Anchorage one of the largest cities in the US with no sales tax at all, which surprises many visitors. Fairbanks city also charges no tax, though the surrounding Fairbanks North Star Borough charges 0%.
Alaska also pays residents an annual Permanent Fund Dividend from oil revenues — residents effectively receive money from the state rather than paying income or sales tax.
Hidden Taxes in No-Tax States
Even in the five no-tax states, several categories carry taxes that consumers often overlook:
Taxes that exist in all 5 no-tax states
- Gasoline tax: All five states charge fuel excise taxes. Oregon at $0.40/gallon is among the higher fuel tax states.
- Tobacco tax: All five tax cigarettes and tobacco products
- Alcohol tax: All five have excise taxes on beer, wine, and spirits
- Property tax: All five collect property taxes, though rates vary significantly
The income tax trade-off
States without sales tax generally compensate with higher income or property taxes. Oregon's top income tax rate of 9.9% is among the highest nationally. New Hampshire taxes interest and dividends. Delaware has a graduated income tax up to 6.6%. Montana has an income tax up to 6.9%. Only Alaska has neither a statewide sales tax nor a personal income tax — funded instead by oil revenues.
Cross-Border Shopping — Does It Work?
Cross-border shopping — driving to a no-tax state to make purchases — is popular in areas near state lines. But there are important limitations:
When cross-border shopping saves money
- Large one-time purchases: A $3,000 appliance saves $180–$250 in sales tax depending on your home state rate — potentially worth a day trip
- Clothing in New Hampshire: MA residents near the NH border regularly shop in NH for clothing and electronics
- Oregon for electronics: Californians near the border save 8.68% on computers, cameras, and similar items
- Delaware for luxury goods: Pennsylvania and NJ residents save 6%+ on jewelry, handbags, and high-end clothing
When it does not work — use tax
Most states have a use tax that technically applies when you buy goods in a no-tax state and bring them home. The use tax rate equals your home state's sales tax rate. Enforcement on small purchases is practically nonexistent, but large purchases — especially vehicles, boats, and aircraft — are routinely caught when you register them in your home state.
Vehicles: Buying a car in Oregon or Montana specifically to avoid your home state's sales tax rarely works. Every state requires sales tax or use tax payment at registration. Oregon and Montana are frequently used schemes that state DMVs have seen hundreds of times — they flag and collect.
Is Moving to a No-Tax State Worth It?
The tax savings from living in a no-tax state depend heavily on your spending patterns and income level:
Annual sales tax savings estimate
| Household Spending | At 8% Sales Tax | At 0% (No Tax State) | Annual Saving |
|---|---|---|---|
| $30,000/year taxable purchases | $2,400 | $0 | $2,400 |
| $50,000/year taxable purchases | $4,000 | $0 | $4,000 |
| $80,000/year taxable purchases | $6,400 | $0 | $6,400 |
These savings are real — but they must be weighed against higher income taxes in Oregon and Montana, higher property values in NH and OR driven partly by their tax advantage, and cost-of-living differences. Alaska's combination of no sales and no income tax is genuinely advantageous on paper, but the high cost of goods shipped to remote areas offsets much of the benefit for most residents.
For retirees on fixed incomes with low taxable wages, moving to a no-tax state offers cleaner savings with less of the income tax offset. For high earners moving to Oregon specifically, the 9.9% top income tax may cost more than a 7–8% sales tax would have.
What No-Tax States Mean for Reverse Sales Tax
If you purchased Oregon, Montana (outside resort areas), Delaware, New Hampshire (non-meals/rooms), or Anchorage, Alaska — your receipt should show zero tax. If you see any tax charged on an everyday retail purchase in these jurisdictions, use our reverse sales tax calculator to verify the amount and confirm whether it was correctly applied.
For purchases in Alaska's taxing municipalities, use the local rate shown on your receipt. Juneau at 5% uses a factor of 1.05; Ketchikan at 6.5% uses 1.065.
Related reading: USA sales tax rates by state · Sales tax holidays 2026 · Free reverse calculator
Frequently asked questions
Five states have no statewide sales tax: Oregon, Montana, Delaware, New Hampshire, and Alaska. Alaska is unique — it has no state tax but allows local governments to charge up to 7.5% in some areas.
Generally no. Most states require you to pay use tax when you register a vehicle in your home state, even if you bought it in a no-tax state. The tax is based on where you register, not where you buy.
New Hampshire has no general sales tax. However, it does tax meals and rooms at 8.5%, tobacco, and rental cars. These specific taxes apply even though everyday retail purchases are tax-free.
No. Since the 2018 Wayfair ruling, sellers with economic nexus in your state must collect your state's sales tax regardless of where the seller is located. Buying from an Oregon store online does not exempt you from your own state's tax.
Alaska has no statewide sales tax but allows boroughs and cities to impose local sales taxes up to 7.5%. About 100 Alaskan municipalities charge some form of sales tax. Juneau charges 5%, Anchorage charges 0%, Fairbanks charges 0%.