How do some states (TN, FL, etc) get by with having no income tax? Why can’t every state get rid of it?
In: Economics
They raise revenue by other means.
Tennessee has one of the higher sales tax rates of the country, with the non-grocery sales tax reaching 9-10% in many parts of the state, and a roughly average property tax alongside it.
Alabama has one of the lowest property tax rates in the country, but charges a 6% statewide sales tax (only discounted to 5% on groceries) when many local sales taxes bring that up to 9-10%. (Few, if any, counties/cities exempt their own sales taxes for groceries). Hence why the state also has a fairly moderate income tax.
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