Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections:22 min read
Arizona Tax Rates, Collections, and Burdens
How does Arizona’s tax code compare? Arizona has a flat 2.50 percent individual income tax. Arizona has a 4.90 percent corporate income tax rate, a 5.60 percent state sales tax rate, a max local sales tax rate of 5.30 percent, and a 8.37 percent combined state and local sales tax rate. Arizona’s tax system ranks 19th overall on our 2024 State Business Tax Climate Index.
Each state’s tax code is a multifaceted system with many moving parts, and Arizona is no exception. The first step towards understanding Arizona’s tax code is knowing the basics. How does Arizona collect tax revenue? Click the tabs below to learn more! You can also explore our state tax maps, which are compiled from our annual publication, Facts & Figures: How Does Your State Compare?
State Tax Data
Average Local Sales Tax Rate2.77%See Full Study
State and Local General Sales Tax Collections per Capita$1742Rank: 6
State Gasoline Tax Rate (cents per gallon)19.00¢Rank: 47
State Cigarette Tax Rate (dollars per 20-pack)$2Rank: 18
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