Taxes in Minnesota

Minnesota Tax Rates, Collections, and Burdens

How does Minnesota’s tax code compare? Minnesota has a graduated individual income tax, with rates ranging from 5.35 percent to 9.85 percent. Minnesota also has a 9.80 percent corporate income tax rate. Minnesota has a 6.875 percent state sales tax rate, a max local sales tax rate of 2.00 percent, and an average combined state and local sales tax rate of 7.49 percent. Minnesota’s tax system ranks 45th overall on our 2023 State Business Tax Climate Index.

Each state’s tax code is a multifaceted system with many moving parts, and Minnesota is no exception. The first step towards understanding Minnesota’s tax code is knowing the basics. How does Minnesota 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?

Top Individual Income Tax Rate

9.85%

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State and Local Individual Income Tax Collections per Capita

$2135

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State and Local Tax Burden

12.1%

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Top Corporate Income Tax Rate

9.80%

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State Business Tax Climate Index Ranking

45

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State Sales Tax Rate

6.875%

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Average Local Sales Tax Rate

0.61%

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Combined State and Average Local Sales Tax Rate

7.49%

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State and Local General Sales Tax Collections per Capita

$1187

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State Gasoline Tax Rate (cents per gallon)

30.6¢

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State Cigarette Tax Rate (dollars per 20-pack)

$3.703

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Property Taxes Paid as a Percentage of Owner-Occupied Housing Value

1.11%

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State and Local Property Tax Collections Per Capita

$1776

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Featured Articles

The Faulty Revenue Estimate Behind Minnesota’s Consideration of Worldwide Combined Reporting

May 4, 2023

America’s Progressive Tax and Transfer System: Federal, State, and Local Tax and Transfer Distributions

March 30, 2023

Close to Home: A Short Guide to Property Taxes

March 27, 2023

Facts & Figures 2023: How Does Your State Compare?

March 23, 2023

Local Income Taxes: A Primer

February 23, 2023

State Individual Income Tax Rates and Brackets for 2023

February 21, 2023

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