State tax revenue by state ranges from roughly $275 billion a year in California down to about $2.6 billion in Wyoming, and the spread between them is driven by three things: how many people live there, how large the economy is, and which taxes the state chooses to impose. Total collections favor big, high-income states with progressive income taxes. Per capita collections tell a different story, one where small resource-rich states can outrank the giants.
States That Collect the Most
California sits at the top with approximately $275 billion in annual state tax revenue in 2025.1Federal Reserve Bank of St. Louis. State Government Tax Collections, Total Taxes in California Nearly 39 million residents, a large tech and entertainment sector, and a top marginal income tax rate among the highest in the country all feed that number.
New York is second. The state collected $127.5 billion during its 2025–26 fiscal year, with Wall Street earnings and a multi-bracket income tax pulling in revenue from one of the highest-earning workforces in the country.2New York State Comptroller. DiNapoli – State Tax Collections Exceeded Estimates for SFY 2025-26
Texas rounds out the top group at roughly $91 billion in 2025.3Federal Reserve Bank of St. Louis. State Tax Collections – Total Taxes for Texas Notable because Texas has no personal income tax, it makes up the ground through sales taxes and the franchise tax, a gross receipts levy on business activity.
States That Collect the Least
At the other end, Wyoming’s total state tax collections came to about $2.6 billion in 2025.4Federal Reserve Bank of St. Louis. State Tax Collections – Total Taxes for Wyoming With roughly 580,000 residents and no individual income tax, the state funds itself through sales taxes and severance taxes on oil, gas, and coal.
Small totals do not mean residents pay less. A state with a modest population and volatile resource revenue can still spend generously per person, and a large state collecting hundreds of billions may spread the cost thinly enough that individual households barely notice. Total collections measure the scale of state government, not the pressure on any one taxpayer.
Tax Revenue Per Capita
Dividing collections by population reorders the list. North Dakota leads at roughly $7,341 per resident, thanks largely to severance taxes on oil production that generate outsized revenue relative to the state’s small population. California comes in around $6,735 per person, and New York around $6,428.
States without an income tax cluster near the bottom of the per capita ranking. Florida’s state-only per capita collections are roughly $2,699, and Tennessee’s sit around $3,343. Both figures reflect a deliberate policy choice to keep the state tax footprint smaller, even though local taxes and fees may partly fill the gap. Watch out for comparisons that combine state and local taxes into a single number; that combination often makes states like New York look even higher and muddles the picture if you only want to see what the state itself collects.
Severance Taxes and Resource States
Severance taxes on oil, natural gas, coal, and minerals can pull a small state’s per capita revenue well above states with much larger economies. Thirty-three states collect some form of severance tax, but the revenue is concentrated in a handful. Alaska, North Dakota, and Wyoming have historically drawn a disproportionate share of their tax revenue from extraction, which is what puts them near the top of the per capita ranking despite modest total collections.
The catch is volatility. When commodity prices drop, these states can see revenue fall sharply in a single fiscal year, opening budget gaps that are hard to close on short notice.
How the Tax Mix Shapes the Ranking
Every state assembles its revenue from a slightly different menu. The major categories are consistent nationwide, but the weight each state gives them explains most of the difference between neighbors on the ranking.
- General sales taxes charged as a percentage of the purchase price on goods and many services. After the Supreme Court’s 2018 decision in South Dakota v. Wayfair, Inc., states can require out-of-state online sellers to collect sales tax based on economic activity alone. Most states now also apply sales tax to digital downloads, streaming, and cloud software, though the specifics differ.5Supreme Court of the United States. South Dakota v Wayfair Inc
- Individual income taxes on wages, salaries, and investment earnings. Forty-two states tax individual income, and most use a progressive bracket structure.
- Corporate income taxes on business profits, allocated across states using apportionment formulas.
- Excise taxes on specific products like gasoline, cigarettes, and alcohol, usually as a flat dollar amount per unit.
- Gross receipts taxes on total business revenue rather than net profit. Delaware, Nevada, Ohio, Oregon, Tennessee, Texas, and Washington all impose some form. Revenue tends to be steadier than corporate income tax because it applies regardless of profit.
States With No Income Tax
Eight states impose no individual income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, and Wyoming. Washington recently moved the other way by enacting a capital gains tax of 7% on long-term gains between $278,000 and $1 million and 9.9% on gains above $1 million, with a proposed broader income tax on earnings over $1 million that could take effect in 2028 if enacted. No-income-tax states lean on sales taxes, severance taxes, or tourism revenue instead. That model attracts retirees and high earners, but revenue drops fast when consumer spending stalls in a recession.
States With No Sales Tax
Five states have no general sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon.6Oregon Department of Revenue. Sales Tax in Oregon Oregon funds its government primarily through a personal income tax and a gross receipts-style corporate activity tax.7Oregon Department of Revenue. Personal Income Tax Shifting the burden from consumption to earnings tends to produce more progressive outcomes, but it exposes the state when unemployment rises or high earners relocate.
Why the Mix Matters for the Ranking
States heavily dependent on sales taxes hold steady during full employment but suffer when recessions cut consumer spending. States relying on income taxes collect more during booms and drop harder when layoffs hit or capital gains dry up. A given state’s position on the ranking is partly a snapshot of where its chosen mix sits in the current cycle, not a permanent order.
Where Revenue Stands Right Now
After a pandemic-era surge driven by federal stimulus and unusual capital gains realizations, state tax revenue has settled into a period of modest, below-trend growth. Inflation-adjusted tax revenue rose 2.2% nationally in fiscal 2025 compared with the prior year, but total collections remained 2.3% below the 15-year trend line after adjusting for inflation.8The Pew Charitable Trusts. State Tax Revenue Stabilizes Amid Rising Fiscal Uncertainty About half of states recorded real gains; the other half saw collections shrink in inflation-adjusted terms.
Preliminary fiscal 2026 data continues that pattern. Forty-one states reported nominal increases in the first half of the fiscal year, but only 26 did after adjusting for inflation.8The Pew Charitable Trusts. State Tax Revenue Stabilizes Amid Rising Fiscal Uncertainty Collections are growing, but not fast enough to keep pace with rising costs. Several states are projecting structural budget imbalances where recurring revenue can’t cover recurring expenses, which typically leads to either spending cuts or renewed debates over tax increases. Deferred road maintenance, delayed capital projects, and tighter eligibility for assistance programs tend to be the first places residents feel the squeeze.