Virginia has a graduated state individual income tax, with rates ranging from 2.00 percent to 5.75 percent. There are also jurisdictions that collect local income taxes. Virginia has a flat 6.00 percent corporate income tax rate, a 5.30 percent state sales tax rate (including a mandatory 1 percent local add-on), and an average combined state and local sales tax rate of 5.77 percent. Virginia has a 0.78 percent effective property tax rate on owner-occupied housing value. Virginia does not have an estate tax or inheritance tax. Virginia’s gas tax is 41.6 cents per gallon, and its cigarette excise tax is $0.60 per pack of 20 cigarettes.
Virginia raises tax revenue primarily through property taxes (30.8 percent of total state and local tax revenue), individual income taxes (27.1 percent), and other taxes (19.8 percent). Virginia collects $7,043 in state and local tax collections per capita, carries $9,182 in state and local debt per capita, and has a 93 percent funded ratio of public pension plans. Virginia’s tax system ranks 30th overall on the 2026 State Tax Competitiveness Index.
Each state’s tax code is a multifaceted system with many moving parts, and Virginia is no exception. Use the tabs below to compare Virginia taxes with other states and to see how Virginia 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.
122 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
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.
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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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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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As a rule, an individual’s income can be taxed both by the state in which the taxpayer resides and by the state in which the taxpayer’s income is earned.
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Forty-four states levy corporate income tax. Top rates range from a 2.25 percent flat rate in North Carolina to a 11.5 percent top marginal rate in New Jersey.
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Americans were on the move in 2024, and many chose low-tax states over high-tax ones.
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Tax avoidance is a natural consequence of tax policy. Policymakers should consider the unintended consequences, both to public health and public coffers, of the excise taxes and regulatory regimes for cigarettes and other nicotine products.
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Consumers legally wagered more than $100 billion on sporting contests in 2023, creating more than $1.8 billion in state revenue. Sports betting is now legal in 38 states and DC, and the landscape is rapidly evolving.
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Recent data suggest that tax competitiveness plays a significant role in residents’ relocation decisions.
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Growing cigarette tax levels and differentials have made cigarette smuggling both a national problem and a lucrative criminal enterprise.
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Over 500 million premium cigars were sold in the United States in 2023. With each sale comes a complex tax landscape.
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Policymakers can and should address taxpayers’ legitimate grievances about out-of-control property tax bills, but they should do so without upending a system of taxation that is more efficient, fair, and pro-growth, and better suited to municipal finance, than any of the alternatives.
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