State Individual Income Tax Rates and Brackets, 2023
Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections:
9 min readHow 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?
Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections:
9 min readCompare the latest 2023 sales tax rates as of July 1st. Sales tax rate differentials can induce consumers to shop across borders or buy products online.
8 min readNew Jersey levies the highest top statutory corporate tax rate at 11.5 percent, followed by Minnesota (9.8 percent) and Illinois (9.50 percent). Alaska and Pennsylvania levy top statutory corporate tax rates of 9.40 percent and 8.99 percent, respectively.
6 min readFacts & Figures serves as a one-stop state tax data resource that compares all 50 states on over 40 measures of tax rates, collections, burdens, and more.
2 min readThe mix of tax sources states choose can have important implications for both revenue stability and economic growth, and the many variations across states are indicative of the different ways states weigh competing policy goals.
29 min readWhile there are many ways to show how much is collected in taxes by state governments, our Index is designed to show how well states structure their tax systems by focusing on the how more than the how much in recognition of the fact that there are better and worse ways to raise revenue.
129 min readWhile the wireless market has become increasingly competitive in recent years, resulting in steady declines in the average price for wireless services, the price reduction for consumers has been partially offset by higher taxes.
41 min readThe logic that has prevailed for local sales taxes should apply equally to other taxes that localities impose on multijurisdictional businesses, including local tourism taxes. The evidence is clear that central administration of local taxes reduces compliance costs without sacrificing local revenue.
15 min readPeople respond to incentives. As tax rates increase or products are banned from sale, consumers and producers search for ways around these penalties and restrictions.
19 min readIn times of high inflation, states should consider adopting permanent full expensing because it boosts long-run productivity, economic output, and wages.
7 min readAll corporate income taxes fall on capital investment, but the structure should not make matters worse, and policymakers should take care not to distort investment decisions through the use of targeted incentives for select firms or activities instead of a lower rate for all businesses.
2 min readRemote and flexible work opportunities are here to stay, whether states like it or not. With enhanced opportunities to take their job with them wherever they please, more workers can factor tax burdens into their decision of where to live.
15 min readRecreational marijuana taxation is one of the hottest policy issues in the U.S. Currently, 19 states have implemented legislation to legalize and tax recreational marijuana sales.
5 min readWhile there are many ways to show how much is collected in taxes by state governments, our Index is designed to show how well states structure their tax systems by focusing on the how more than the how much in recognition of the fact that there are better and worse ways to raise revenue.
129 min readFrom income tax changes to cannabis legalization and taxation, here’s what voters decided on Election Day.
1 min readIRS and Census data show that people and businesses favor states with low and structurally sound tax systems, which can impact the state’s economic growth and governmental coffers.
12 min read