Home > Taxes > 10 Taxes Determined by your Location

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While the U.S. is one unified country, there are 50 different states within our union. And thanks to the tenth amendment, each state has the freedom to do many things according to the preferences of only its state legislature (voted on by that state’s citizens), as opposed to the nation at large. For this reason, many of the taxes you pay are largely determined by your geographical location and consumption. Here are the 10 taxes that may vary depending on where you live within the U.S. (including Alaska and Hawaii, of course).

  1. State income tax

    Perhaps the most obvious tax on this list, your state of residency determines if and how you’re taxed (or not taxed) just for being a resident of that state. You may already know that many states do not ask residents to pay state tax, but this is usually made up in other forms, such as higher sales tax, utility tax, or property tax. State taxes usually fund everything from infrastructure (other than interstate highways) to state parks.

  2. Local income tax

    Only a small number of jurisdictions charge this tax to their citizens, and this number continues to decrease yearly as most city and county budgets are determined by the state.

  3. Sales tax

    As previously mentioned, some states have higher sales tax due to their lack of certain other taxes. For example, Nevada doesn’t charge income tax, but does charge over 6 percent sales tax. New Hampshire, on the other hand, is one state with no sales OR state income tax. (It does get pretty cold there, though.)

  4. Utility tax

    Most Americans have to pay taxes for the utilities they use, such as water, natural gas, or electricity. Recently, however, it was reported that some of these utility companies may not be paying on the taxes they collect from consumers.

  5. Public transportation fare

    This might seem out of place on this list, but transportation fares are a form of tax. Since our taxes already go to fund various types of infrastructure already (such as roads and bridges), fares allow residents of a city to utilize public transportation. Additionally, because some citizens are offered discounted fare due to income, fares are calculated to cover those losses. That makes public transportation fare a form of taxes.

  6. Property tax

    This tax usually refers to homeowners and varies from county to county. Property tax rates are determined by and paid to the county in which you own property. It can also be applied to specific things you own, such as boats and RVs.

  7. Sin tax

    Not to be confused with syntax, these are taxes levied against things seen as morally questionable by society, such as alcohol, tobacco, gambling, and various other “vices.” States that have legalized marijuana recreationally, including Colorado, Washington, and California, have experienced a major influx of taxes due to the high sin tax on cannabis.

  8. Tuition

    Tuition paid to any state-run university is actually considered a form of tax. Fun fact: the government used to subsidize many of the tuition costs associated with college, but as time has worn on, they have increasingly shifted the burden onto the students and their parents.

  9. Value-added tax

    Value-added tax (or VAT) is a tax charged on some retail goods when value is added at the point of retail sale. It tends to work itself into the mix when travel is involved. For example, many Americans who travel may experience a VAT on certain products they buy here at home, but not on those same products when purchased in their country of origin (such as high-end purses produced in France).

  10. Real estate tax

    Real estate taxes are paid based on where you live and are a sub-tax under property taxes for homeowners. The percentages vary from state to state. Hawaii residents pay the lowest percentage, at .32 percent and those in New Jersey pay the highest at 2.31 percent.

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