Alabama’s Reliance On Sales Tax
Report: Alabama ranks in the middle of states--29.9%
From the Tax Foundation
“Today’s map highlights the extent to which sales taxes are responsible for tax revenue generation in each state. Washington – lacking both a corporate and an individual income tax but levying the harmful gross receipts tax on businesses – relies the most on sales tax revenue, which accounts for 45.9 percent of total tax collections. Tennessee, which does not tax wage income and is currently phasing out its tax on investment income, has the second highest reliance on sales taxes (40.7 percent of state and local tax collections). South Dakota is the third most reliant on sales tax revenue, with 40.5 percent of tax collections attributable to sales taxes. (South Dakota does not collect individual or corporate income taxes.)”
The Tax Foundation describes itself as:
“the nation’s leading independent tax policy research organization. Since 1937, our principled research, insightful analysis, and engaged experts have informed smarter tax policy at the federal, state, and local levels. We improve lives through tax policy research and education that leads to greater economic growth and opportunity.”
Montgomery’s sales tax is 10%
A previous Tax Foundation map showed Alabama as having among the highest sales taxes in the country.