Five states have no statewide sales tax
Alaska, Delaware, Montana, New Hampshire, and Oregon do not charge a statewide sales tax. This means when you buy something in these states, you pay only the price on the tag — no additional percentage gets added at checkout.
However, the absence of statewide sales tax does not mean zero sales tax everywhere in these states. Alaska allows cities and boroughs to charge local sales taxes, and some do. Delaware, Montana, New Hampshire, and Oregon prohibit local sales taxes entirely, so shoppers in those states genuinely pay no sales tax on most purchases.
The reason these five states have no sales tax varies. Some chose not to implement one when other states did. Others rely more heavily on income tax, property tax, or other revenue sources. The result is the same for shoppers: lower out-of-pocket cost at the register.
Key Takeaways
- Alaska, Delaware, Montana, New Hampshire, and Oregon have no statewide sales tax, though Alaska permits local taxes in some cities.
- In Delaware, Montana, New Hampshire, and Oregon, local governments cannot add sales tax on top of the state rate because there is no state rate.
- No sales tax does not mean no taxes — these states fund government through income tax, property tax, or other methods instead.
- If you live in or travel to a no-sales-tax state, the price you see is the price you pay, with no surprise additions at checkout.
How Alaska's local sales taxes work
Alaska is the only no-sales-tax state where you might still pay sales tax, depending on where you shop. The state government does not charge sales tax, but it allows individual cities and boroughs to set their own local rates.
Anchorage, Juneau, Fairbanks, and dozens of smaller towns have local sales taxes ranging from about 5 percent to 7.5 percent. Other parts of Alaska have no local tax at all. If you are shopping in Anchorage, you pay tax. If you are shopping in a small community outside the tax area, you do not.
This creates a patchwork: the same item costs different amounts depending on which Alaskan city you are in. Visitors and residents need to know which municipality they are in to know whether tax applies.
Why these states chose not to tax sales
Each of the five no-sales-tax states arrived at that policy through different paths. New Hampshire and Montana have long resisted sales tax and instead rely on property tax and other sources. Delaware has no sales tax partly because its economy historically depended on attracting businesses and residents from neighboring states.
Oregon voters have rejected sales tax proposals multiple times. Alaska's oil revenue historically reduced the need for sales tax, though that relationship has shifted over decades.
The point for shoppers is practical: these states made a deliberate choice, and that choice remains in effect. You will not see sales tax added in these places because the state government does not permit it.
What you pay instead in no-sales-tax states
States without sales tax do not have lower total taxes — they shift the burden elsewhere. New Hampshire and Montana charge property tax. Oregon and Delaware rely on income tax. Alaska has both, plus oil-based revenue.
If you move to or do business in a no-sales-tax state, you may pay less at the register but more on your annual tax return or property bill. The total tax burden varies by state and by your personal situation, so a no-sales-tax state is not automatically cheaper overall.
For shoppers making a single purchase, though, the benefit is clear: no surprise tax at checkout.
How this affects online shopping
When you order something online and have it shipped to a no-sales-tax state, whether you pay sales tax depends on the seller's location and the item type, not on your state's rules. Federal law and state agreements determine what gets taxed, and those rules change frequently.
Most large online retailers now collect sales tax based on where the item ships, regardless of the seller's state. So ordering from out of state to a no-sales-tax state does not automatically save you tax. Check the retailer's tax policy or your cart before checkout to see what you will actually pay.
Frequently Asked Questions
Do I pay sales tax if I buy something online and have it shipped to Oregon?
Oregon has no sales tax, but the seller determines whether to charge tax based on their own location and the item type, not on Oregon's rules. Most major retailers charge tax on orders shipped to Oregon if they would charge tax in their home state. Check your cart before completing the purchase.
Can I avoid sales tax by shopping in Alaska instead of Washington?
Only if you shop in an Alaskan city or borough with no local sales tax. Anchorage, Juneau, and Fairbanks all have local taxes. Washington has a statewide sales tax of about 6.5 percent plus local additions. Some Alaskan towns have lower or no tax, but you need to know which municipality you are in.
If I move to New Hampshire, will my taxes be lower overall?
New Hampshire has no sales tax, but it charges property tax and income tax on interest and dividends. Your total tax bill depends on your income, property value, and spending habits. A no-sales-tax state is not automatically cheaper — it shifts where you pay, not how much.
Does Delaware's lack of sales tax apply to everything I buy?
Yes. Delaware has no sales tax on any retail purchase, including clothing, groceries, and electronics. This applies statewide with no local exceptions, so the price on the tag is what you pay.
Why do some states have sales tax and others don't?
Each state chooses its own tax structure based on history, politics, and revenue needs. Some states adopted sales tax early and kept it. Others rejected it and funded government through income or property tax instead. There is no federal requirement for sales tax — it is entirely a state decision.