Cigarette Taxes and Cigarette Smuggling by State, 2021
People respond to incentives. As tax rates increase or products are banned from sale, consumers and producers search for ways around these penalties and restrictions.
17 min read
Kentucky Tax Rates, Collections, and Burdens
How does Kentucky’s tax code compare? Kentucky has a flat 4.50 percent individual income tax rate. There are also jurisdictions that collect local income taxes. Kentucky has a 5.00 percent corporate income tax rate. Kentucky has a 6.00 percent state sales tax rate and does not levy any local sales taxes. Kentucky’s tax system ranks 18th overall on our 2023 State Business Tax Climate Index.
Each state’s tax code is a multifaceted system with many moving parts, and Kentucky is no exception. The first step towards understanding Kentucky’s tax code is knowing the basics. How does Kentucky 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?
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