How does North Dakota’s tax code compare? North Dakota has a graduated state individual income tax, with rates ranging from 1.95 percent to 2.50 percent. North Dakota has a graduated corporate income tax, with rates ranging from 1.41 percent to 4.31 percent. North Dakota also has a 5.00 percent state sales tax rate and an average combined state and local sales tax rate of 7.04 percent. North Dakota has a 0.97 percent effective property tax rate on owner-occupied housing value.
North Dakota does not have an estate tax or inheritance tax. North Dakota has a 23 cents per gallon gas tax rate and a $0.44 cigarette excise tax rate. The State of North Dakota collects $7,007 in state and local tax collections per capita. North Dakota has $12,057 in state and local debt per capita and has a 67 percent funded ratio of public pension plans. North Dakota’s tax system ranks 9th overall on the 2025 State Tax Competitiveness Index.
Each state’s tax code is a multifaceted system with many moving parts, and North Dakota is no exception. The first step towards understanding North Dakota’s tax code is knowing the basics. How does North Dakota 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.
115 min read
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.
2 min read
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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However well-intended they may be, sales tax holidays remain the same as they always have been—ineffective and inefficient.
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Of all alcoholic beverages subject to taxation, stiff drinks—and all distilled spirits—face the stiffest tax rates. Like many excise taxes, the treatment of distilled spirits varies widely across the states.
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