Massachusetts has a flat 5.00 percent individual income tax rate, with a 4 percent surtax on income over $1 million (adjusted for inflation), resulting in a top rate of 9.00 percent. Massachusetts has a flat 8.00 percent corporate income tax rate, a 6.25 percent state sales tax rate, and an average combined state and local sales tax rate of 6.25 percent. Massachusetts has a 1.00 percent effective property tax rate on owner-occupied housing value. Massachusetts has an estate tax. Massachusetts’s gas tax is 27.56 cents per gallon, and its cigarette excise tax is $3.51 per pack of 20 cigarettes.
Massachusetts raises tax revenue primarily through individual income taxes (34.3 percent of total state and local tax revenue), property taxes (33.1 percent), and general sales taxes (14.6 percent). Massachusetts collects $9,076 in state and local tax collections per capita, carries $13,400 in state and local debt per capita, and has a 76 percent funded ratio of public pension plans. Massachusetts’s tax system ranks 43rd overall on the 2026 State Tax Competitiveness Index.
Each state’s tax code is a multifaceted system with many moving parts, and Massachusetts is no exception. Use the tabs below to compare Massachusetts taxes with other states and to see how Massachusetts raises tax revenue. You can also browse our tax maps, which are compiled from our annual publication, Facts & Figures 2026: How Does Your State Compare?
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The State Tax Competitiveness Index enables policymakers, taxpayers, and business leaders to gauge how their states’ tax systems compare. While there are many ways to show how much state governments collect in taxes, the Index evaluates how well states structure their tax systems and provides a road map for improvement.
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Facts & 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.
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Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections. How do income taxes compare in your state?
9 min read
Retail sales taxes are an essential part of most states’ revenue toolkits, responsible for nearly a quarter of combined state and local tax collections.
18 min read
Forty-four states levy a corporate income tax, with top rates ranging from a 2 percent flat rate in North Carolina to an 11.5 percent top marginal rate in New Jersey. Four states—Georgia, Nebraska, North Carolina, and Pennsylvania—reduced their corporate income tax rates effective January 1, 2026.
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Property taxes are the primary tool for financing local governments. While no taxpayers in high-tax jurisdictions will be celebrating their yearly payments, property taxes are largely rooted in the benefit principle of taxation: the people paying the property tax bills are most often the ones benefiting from the services.
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However states choose to respond to other tax provisions of the One Big Beautiful Bill Act, they should conform to the pro-growth provisions, which represent a marked improvement in the corporate tax code.
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However well-intended they may be, sales tax holidays remain the same as they always have been—ineffective and inefficient.
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The One Big Beautiful Bill’s changes to the taxation of international income have surprising implications for state codes, yielding tax increases and a revised tax base that, through quirks of state incorporation, bears very little resemblance to the federal base and almost nothing of its purpose.
10 min read
The five states with the highest average combined state and local sales tax rates are Louisiana (10.11 percent), Tennessee (9.61 percent), Arkansas (9.48 percent), Washington (9.47 percent), and Alabama (9.44 percent).
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The Senate’s version of the OBBB restores the benefit of avoiding the SALT deduction cap with PTETs for all pass-through businesses, while placing new limits on the extent of the workarounds.
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Rhode Island lawmakers are debating raising the state’s top income tax rate. Though billed as a tax hike on high earners, the consequences would manifest across the state’s entire economy—creating a risk that Rhode Island will tax its way into uncompetitiveness.
As the US House hashes out its “One, Big, Beautiful Bill,” statehouse lawmakers are watching closely, given the impact of both its tax and spending provisions on state budgets.
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Six states and DC assess a state-level non-UI payroll tax in addition to their mandatory federal UI payroll tax.
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As home values have spiked, Florida and other states are weighing elimination of property taxes.
The Institute for Policy Studies (IPS) only succeeds in demonstrating that America has more millionaires than it used to, not that high-tax states are doing well in attracting or retaining them.
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