States with No Sales Tax: The Complete 2026 Guide
Five states do not charge a statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. That means consumers in those states pay no state sales tax when they walk into a store and buy a pair of shoes, a laptop, or a gallon of paint.
But "no sales tax" does not mean "no taxes." Each of these states generates revenue through other mechanisms: property taxes, income taxes, gross receipts taxes, excise taxes, and local option taxes. And for business owners, the absence of sales tax does not eliminate the need to understand resale certificates, especially if you sell to customers in other states.
The Five No-Sales-Tax States at a Glance
| State | State Sales Tax | Local Sales Tax | Primary Revenue Sources |
|---|---|---|---|
| Alaska | None | Yes (up to 7.5%) | Oil revenue, property tax, local sales taxes |
| Delaware | None | None | Gross receipts tax, corporate franchise tax, income tax |
| Montana | None | None (limited resort tax) | Income tax, property tax, resource extraction taxes |
| New Hampshire | None | None | Property tax, business profits tax, meals and rooms tax |
| Oregon | None | None (limited local taxes) | Income tax, corporate activity tax, property tax |
Now let us look at each state in detail.
Alaska: No State Tax, But Watch the Locals
Alaska is the most complicated of the five. The state itself charges no sales tax, but it allows cities and boroughs to levy their own local sales taxes. Over 100 Alaska localities do exactly that.
Local Sales Tax Rates
Local rates in Alaska range from 1% to 7.5%. Some examples:
| City/Borough | Local Sales Tax Rate |
|---|---|
| Juneau | 5% |
| Anchorage | 0% (no local sales tax) |
| Fairbanks North Star Borough | 0% |
| Kodiak | 7% |
| Skagway | 5% |
| Wasilla | 2.5% |
| Soldotna | 6% |
| Sitka | 6% |
Anchorage, Alaska's largest city, has no local sales tax. Juneau does. This creates a patchwork where the tax burden depends entirely on where the transaction occurs.
What Alaska Taxes Instead
- Oil and gas revenue: Alaska's government is heavily funded by oil production taxes and royalties from the Trans-Alaska Pipeline. This revenue has historically allowed the state to operate without a statewide income tax or sales tax.
- Property taxes: Levied at the local level. Rates vary significantly by municipality.
- Excise taxes: Taxes on fuel, tobacco, alcohol, and marijuana.
- Corporate income tax: Alaska has a corporate income tax ranging from 0% to 9.4% based on taxable income.
Business Licenses in Alaska
Alaska does not have a state-level sales tax registration because there is no state sales tax. However, if you do business in a locality with sales tax, you need to register with that municipality. Juneau, for example, requires a local sales tax certificate.
Alaska also requires a state business license, which costs $25 annually and is administered by the Division of Corporations, Business, and Professional Licensing.
Delaware: The Gross Receipts Tax State
Delaware has no sales tax and no local sales taxes. Zero. Consumers pay the sticker price and nothing more. But businesses in Delaware face a tax that many other states do not impose: the Gross Receipts Tax.
The Gross Receipts Tax
Delaware's Gross Receipts Tax is levied on a business's total gross revenues. Not profit. Revenue. The rates depend on the type of business activity:
| Business Activity | Gross Receipts Tax Rate |
|---|---|
| Retailers | 0.7483% |
| Wholesalers | 0.3983% |
| Manufacturers | 0.1991% |
| Food processors | 0.1991% |
| Grocers/supermarkets | 0.2142% |
| Restaurants | 0.7483% |
| Commercial feed dealers | 0.1005% |
| Lessors of commercial real estate | 0.2506% |
These rates look small, but they apply to gross revenue, not net income. A retailer doing $2 million in annual revenue pays about $14,966 in gross receipts tax, regardless of whether the business turned a profit.
What Else Delaware Taxes
- Corporate franchise tax: This is why so many companies incorporate in Delaware. Ironically, the franchise tax itself generates substantial revenue for the state. Rates are based on authorized shares or assumed par value.
- Personal income tax: Progressive rates from 2.2% to 6.6%.
- Property tax: Among the lowest in the nation, contributing to Delaware's reputation as tax-friendly.
- Excise taxes: On fuel, tobacco, and alcohol.
Business Registration in Delaware
Because there is no sales tax, Delaware does not issue seller's permits, sales tax permits, or resale certificates. If your business operates exclusively in Delaware and sells only to Delaware customers, you do not need a resale certificate.
But you do need to register for the Gross Receipts Tax with the Delaware Division of Revenue if your business generates revenue in the state.
Montana: Limited Taxes, Limited Exceptions
Montana has no statewide sales tax and almost no local sales taxes. The one exception is a resort tax.
The Resort Tax
Montana allows certain resort communities to levy a local resort tax on the sale of lodging, food, beverages, and luxury goods. The rate is up to 3%. Communities that collect it include:
- Big Sky (3%)
- Red Lodge (3%)
- West Yellowstone (3%)
- Virginia City (3%)
- Whitefish (3%)
This tax is narrow: it applies to specific categories in specific tourist towns. It does not apply to general retail sales.
What Montana Taxes Instead
- Personal income tax: Progressive rates from 1% to 6.75%.
- Corporate income tax: 6.75% flat rate.
- Property tax: Montana has relatively high property tax rates compared to national averages.
- Resource extraction taxes: Coal, oil, and gas production are taxed at the extraction level.
- Vehicle taxes: Instead of a sales tax on vehicle purchases, Montana charges a one-time fee based on the vehicle's age and original MSRP.
Business Licensing in Montana
Montana does not require a sales tax permit because there is no sales tax. However, businesses may need to register with the Montana Department of Revenue for income tax withholding, and certain businesses require specific licenses (liquor, tobacco, marijuana, etc.).
New Hampshire: The Live Free or Die Tax Structure
New Hampshire takes a strong anti-tax stance. No sales tax. No state income tax on wages or salary. The state relies on property taxes and targeted business taxes.
What New Hampshire Taxes
- Property tax: This is the big one. New Hampshire has the third-highest property tax rates in the country, with an effective rate of roughly 1.86%. Property taxes fund local governments, schools, and county operations.
- Business Profits Tax (BPT): An 7.5% tax on business net income over $50,000.
- Business Enterprise Tax (BET): A 0.55% tax on the enterprise value tax base (compensation, interest, and dividends paid). The BET can be credited against the BPT.
- Meals and Rooms Tax: 8.5% on restaurant meals, hotel rooms, and motor vehicle rentals. This is not a general sales tax; it applies only to these categories.
- Interest and Dividends Tax: Previously taxed interest and dividend income, but this tax was fully phased out as of January 1, 2025.
- Tobacco tax: $1.78 per pack.
- Alcohol: No excise tax on spirits (state-run liquor stores), but taxes on beer and wine.
- Real Estate Transfer Tax: 0.75% paid by both buyer and seller ($1.50 per $100 total).
Business Registration in New Hampshire
No sales tax means no sales tax registration, no seller's permit, and no resale certificates for in-state transactions. Businesses do need to register with the New Hampshire Department of Revenue Administration for the Business Profits Tax and Business Enterprise Tax.
Oregon: Income Tax Heavy, Sales Tax Free
Oregon voters have repeatedly rejected sales tax proposals. The most recent was in 2020, when a proposed 5% sales tax was defeated. The state remains firmly in the income-tax-funded camp.
What Oregon Taxes
- Personal income tax: Progressive rates from 4.75% to 9.9%. The top rate applies to income over $125,000 (single filers) or $250,000 (joint filers). Oregon's income tax is among the highest in the country.
- Corporate Activity Tax (CAT): Enacted in 2020, this is a 0.57% tax on commercial activity over $1 million. It includes a $250 flat tax on businesses with gross receipts between $750,000 and $1 million. The CAT is similar to a gross receipts tax.
- Corporate excise tax: 6.6% on the first $1 million of taxable income, 7.6% above that.
- Property tax: Moderate rates, with constitutional limits on assessment increases (Measures 5 and 50).
- Transit taxes: Portland-area employers pay a 0.7837% transit payroll tax. Statewide, there is a 0.1% transit tax on wages.
- Vehicle privilege tax: 0.5% on new vehicle purchases.
- Marijuana tax: 17% at the retail level.
Business Registration in Oregon
Oregon does not issue sales tax permits or resale certificates. Period. However, businesses with Oregon employees must register for state withholding. Businesses with commercial activity exceeding $750,000 must register for the Corporate Activity Tax.
The Portland Factor
Multnomah County (Portland) adds local income taxes on top of Oregon's already high state rate. The Metro Supportive Housing Services personal income tax adds 1% on taxable income above $125,000 (single) or $200,000 (joint), plus 3% above $250,000 (single) or $400,000 (joint). The Multnomah County Preschool for All tax adds similar surcharges.
A high-income Portland resident can face a combined marginal income tax rate above 14% when you add federal, state, county, and local rates. No sales tax, but plenty of other taxes.
Why No-Sales-Tax State Businesses Still Need Resale Certificates
This is the part many business owners miss. Operating in a no-sales-tax state does not exempt you from the sales tax systems of other states.
Scenario 1: Selling to Customers in Other States
You run an online store from Portland, Oregon. You have no Oregon sales tax obligations. But when your sales to Texas customers exceed $500,000 in a year, you have economic nexus in Texas. You must register for a Texas sales tax permit, collect Texas sales tax from Texas buyers, and file Texas sales tax returns.
You also need a resale certificate for your Texas supply chain. If you buy inventory from a Texas wholesaler, you need to present a Texas resale certificate to avoid paying Texas sales tax on those purchases.
Scenario 2: Buying from Suppliers in Sales-Tax States
Your Delaware business buys $20,000 in merchandise from a supplier in New York. The New York supplier has to charge New York sales tax unless you provide a valid exemption or resale certificate. If you are buying the goods for resale, you can complete a New York Form ST-120 (Resale Certificate) to exempt the purchase.
To do this, you need to be registered in a state that collects sales tax, or some suppliers will accept a certificate from a no-sales-tax state if you can prove resale intent. The rules vary by supplier and by state.
Scenario 3: Multi-State Nexus
You operate from New Hampshire but sell on Amazon FBA. Amazon stores your inventory in warehouses in California, Texas, New Jersey, Indiana, and Florida. Your inventory is creating physical nexus in each of those states. You need to register for sales tax in each one, collect from customers in those states, and obtain resale certificates for any purchases you make from suppliers in those states.
The fact that New Hampshire has no sales tax is irrelevant to your obligations in California, Texas, and the rest.
The Bottom Line for No-Sales-Tax State Businesses
If you sell to customers in states that have sales tax, you likely need:
- Sales tax registrations in states where you have nexus
- Resale certificates for purchasing inventory in those states
- Systems to collect, track, and remit sales tax to each state
Even if your home state has no sales tax, get the resale certificates you need for other states.
Frequently Asked Questions
Can I avoid sales tax by ordering online from a no-sales-tax state?
Generally, no. Since the 2018 Wayfair decision, most online sellers with sufficient economic activity in your state are required to collect your state's sales tax, regardless of where the seller is located. If a seller does not collect it, you owe use tax.
Is it worth moving my business to a no-sales-tax state?
Moving to avoid sales tax is rarely a good strategy. You still have nexus obligations in states where your customers are. And no-sales-tax states typically make up the revenue difference through higher income taxes, gross receipts taxes, or property taxes. The total tax burden may be comparable.
Does Amazon charge sales tax on orders shipped to no-sales-tax states?
No. If you live in Oregon, Delaware, Montana, New Hampshire, or Anchorage (Alaska), Amazon does not charge state sales tax. However, if you live in an Alaska locality with local sales tax, Amazon does collect local tax in some jurisdictions.
Are there any cities with no sales tax in sales-tax states?
Not exactly. Some cities choose not to add a local sales tax on top of the state rate, but the state sales tax still applies. There are no zero-sales-tax cities within states that collect sales tax.
Do I need a business license in a no-sales-tax state?
Yes. The absence of a sales tax does not eliminate business licensing requirements. Each state has its own business registration and licensing requirements unrelated to sales tax.
Key Takeaways
- Five states have no statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon.
- Alaska allows local sales taxes, creating a patchwork of rates across the state. The other four have no local general sales taxes.
- These states generate revenue through other means: income taxes, gross receipts taxes, property taxes, and excise taxes. The total tax burden is not necessarily lower.
- Businesses in no-sales-tax states are not exempt from other states' sales tax requirements. If you sell to customers in states with sales tax and exceed nexus thresholds, you must register, collect, and remit.
- Even without a home-state sales tax, you may need resale certificates for purchasing inventory from suppliers in other states.