How does Nebraska’s tax code compare? Nebraska has a graduated state individual income tax, with rates ranging from 2.46 percent to 5.84 percent. Nebraska has a graduated corporate income tax, with rates ranging from 5.58 percent to 5.84 percent. Nebraska also has a 5.50 percent state sales tax rate and an average combined state and local sales tax rate of 6.97 percent. Nebraska has a 1.44 percent effective property tax rate on owner-occupied housing value.
Nebraska has an inheritance tax. Nebraska has a 30 cents per gallon gas tax rate and a $0.64 cigarette excise tax rate. The State of Nebraska collects $6,345 in state and local tax collections per capita. Nebraska has $8,165 in state and local debt per capita and has a 98 percent funded ratio of public pension plans. Nebraska’s tax system ranks 24th overall on the 2025 State Tax Competitiveness Index.
Each state’s tax code is a multifaceted system with many moving parts, and Nebraska is no exception. The first step towards understanding Nebraska’s tax code is knowing the basics. How does Nebraska 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 2024: 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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Tax burdens rose across the country as pandemic-era economic changes caused taxable income, activities, and property values to rise faster than net national product. Tax burdens in 2020, 2021, and 2022 are all higher than in any other year since 1978.
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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?
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Graduated corporate rates are inequitable—that is, the size of a corporation bears no necessary relation to the income levels of the owners.
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Retail sales taxes are an essential part of most states’ revenue toolkits, responsible for 32 percent of state tax collections and 13 percent of local tax collections (24 percent of combined collections).
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Property taxes are the primary tool for financing local governments and generate a significant share of state and local revenues.
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As much as 98 percent of vaping products sold in the US are illicit. Most states levy an excise tax on vaping products, but these tax systems vary substantially. The result is a messy tax system covering largely illicit products, and no one knows whether taxes are being collected and remitted on most products sold nationwide.
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Gov. Pillen is searching for tax burden relief. But his plan, which reportedly involves a two-tiered sales tax and the state’s assumption of most school funding responsibility, would have profound implications that even those most convinced of the urgency of property tax relief may find unworkable and unpalatable.
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However well-intended they may be, sales tax holidays remain the same as they always have been—ineffective and inefficient.
11 min read
An ideal sales tax is imposed on all final consumption, both goods and services, but excludes intermediate transactions to avoid tax pyramiding.
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Retail sales taxes are an essential part of most states’ revenue toolkits, responsible for 32 percent of state tax collections and 13 percent of local tax collections (24 percent of combined collections).
8 min read
The vaping industry has grown rapidly in recent decades, becoming a well-established product category and a viable alternative to cigarettes for those trying to quit smoking. US states levy a variety of tax structures on vaping products.
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