Many people are beginning to wrap their minds around the House Republicans’ proposed destination-based cash-flow tax and what it means for tax reform. Most people are still looking into the tax’s impacts on trade and how...
The facts on Delaware’s Tax Climate
6.6%individual income taxTop rate
8.7%corporate income taxFlat rate
$825property taxcollections per capita
Delaware's Individual Income Tax System
Delaware's individual income tax system consists of six brackets with a top rate of 6.6%. The top rate ranks 17th highest among states levying an individual income tax. Delaware's state and local tax collections per person were $1,283 in 2013, which ranked 10th highest nationally.
Delaware's Corporate Income Tax System
Delaware's corporate income tax system consists of a flat rate of 8.7%. That rate ranks 9th highest among states levying a corporate income tax. Delaware's state and local corporate income tax collections per person were $341 in 2013 which ranked 5th highest nationally. Delaware also imposes a gross receipts tax called the Manufacturers & Merchants License Tax, with rates ranging from 0.0945 percent to 0.7468 percent.
Delaware Sales and Excise Taxes
Delaware levies a 0% general sales or use tax on consumers, which is below the national median of 5.95%. Delaware does not levy additional local sales taxes. Delaware's state and local governments collect $0 per person in general sales taxes and $542 per person in excise taxes, for a combined figure of $542, which ranks 49th highest nationally. Delaware's gasoline tax stands at 23 cents per gallon, 34th highest nationally, while its cigarette tax stands at $1.60, 22nd highest nationally.
Delaware Property Tax Collections Relatively Low
Delaware's state and local governments collected approximately $825 per person in property taxes in 2013, which ranks 44th nationally.
Tax Freedom Day Arrives on April 18th in Delaware
Tax Freedom Day is the day when Americans have finally earned enough money to pay off their total tax bill for the year. In 2016, Delaware taxpayers have to work until April 18th (24th earliest nationally) to pay their total tax bill.
Delaware's State and Local Tax Burden Ranks 16th
Delaware's 2012 tax burden of 10.2% ranks 16th highest in the nation, and is above the national average of 9.9%. Delaware's taxpayers pay $4,412 per capita in state and local taxes.
Other States' State/Local Tax Burdens
Map of U.S. Showing all State's Burdens and Ranks
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2009
Delaware's 2016 Business Tax Climate Index Ranks 14th
Delaware ranks 14th on the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes (50th), individual income taxes (33rd), sales taxes (1st), unemployment insurance taxes (4th), and taxes on property (15th), including residential and commercial property.
State Business Tax Climate Index (full study)
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