How States Raise Their Tax Dollars

FY 2021

How States Raise Their Tax Dollars, FY 2021

Taxes make up about half of state government revenue, with two-thirds of states’ total tax dollars coming from levies on personal income (39.9%) and general sales of goods and services (29.3%). 

Broad-based personal income taxes are the greatest source of tax dollars in 33 of the 41 states that impose them, with the highest share—63.2%—in Oregon. General sales taxes are the largest source in 14 of the 45 states that collect them. Texas is the most reliant on these taxes, at 61.8%—in Oregon. General sales taxes are the largest source in 14 of the 45 states that collect them. Texas is the most reliant on these taxes, at 61.8%. Other sources bring in the most tax revenue in a few states: severance taxes in Alaska and North Dakota, and corporate income taxes in New Hampshire.

This infographic illustrates the sources of each state’s tax revenue.

Mix of Tax Sources by State, FY 2021

Select revenue sources below to highlight them and resort the chart:

Personal income
General sales
Selective sales
Licenses
Corporate income
Property
Severance
Other
0%25%50%75%100%0%25%50%75%100%

Note: Unlike 41 states with broad-based personal income taxes, New Hampshire taxes only certain dividend and interest income. Tennessee had a similar tax in place in fiscal year 2020, but it was fully phased out as of Jan. 1, 2021.

Source: U.S. Census Bureau’s 2021 Annual Survey of State Government Tax Collections

America’s Overdose Crisis
America’s Overdose Crisis

America’s Overdose Crisis

Sign up for our five-email course explaining the overdose crisis in America, the state of treatment access, and ways to improve care

Sign up
Quick View

America’s Overdose Crisis

Sign up for our five-email course explaining the overdose crisis in America, the state of treatment access, and ways to improve care

Sign up
fiscal 50
Data Visualization

Fiscal 50

Quick View
Data Visualization

Fiscal 50: State Trends and Analysis, an interactive resource from The Pew Charitable Trusts, allows you to sort and analyze data on key fiscal, economic, and demographic trends in the 50 states and understand their impact on states’ fiscal health.

Data Visualization

Where States Get Their Money, FY 2020

Quick View
Data Visualization

Pandemic relief aid increased the portion of state government revenue coming from federal dollars to nearly 36% in fiscal year 2020, the highest level on record. The federal share of revenue hit new highs in most states. Federal funds were the largest source of dollars in 18 states, up from just four states a year earlier. Taxes remained the largest revenue source in the other 32 states and overall, at 45.8% of state revenue.