What States Have No Income Tax. States do not impose income tax on personal income. The overwhelming majority of alaska's revenue comes from oil industry activity in the state.

However, there are seven states in the us that do not impose a tax on the income of the workers in the respective states.

States with lower income tax rates may have higher property taxes or sales tax. Although federal income tax is inescapable, state income tax is not. Paychecks and retirement benefits are safe from state taxes if you live here. Especially if they are trying to improve their finances. Income tax is an important source of revenue for most states in the united states. States collect income tax to pay for services such as education, medical care and public infrastructure. There are just seven states that do not have a state income tax. What states have no income tax? The granite state has no sales tax and doesn't tax earned income, although it does require residents to file a tax return when they have interest and dividend income in excess of $2,400, or $4,800 if they're married and filing jointly. If you lived in wyoming, your retirement savings and pension income would be safe from taxation, too — and so would the benefits of having no state income tax are easy to identify. But dividends and some interest are subject to.