Georgia’s tax code includes all major tax types. The state has recently transitioned to a flat individual income tax and is gradually reducing the tax rate (currently 5.19 percent, scheduled to reach 4.99 percent by 2028), two positive developments in terms of tax competitiveness. However, the state still faces strong regional competition, as both Florida and Tennessee do not impose individual income taxes, while Alabama and North Carolina have lower rates.
Since 2024, Georgia’s corporate income tax rate has been aligned with the individual income tax rate and is set to decrease from the current 5.19 percent to 4.99 percent by 2028. However, the state does not allow first-year expensing of capital investment and imposes a nuisance capital stock tax of up to $5,000 per year. Like many states, Georgia also taxes tangible personal property. The state offers a de minimis exemption, but it is quite low.
Georgia’s state sales tax rate is relatively low at 4 percent, but localities are authorized to impose local sales taxes, with an average rate of 3.44 percent, bringing the combined rate to 7.44 percent, which is above the national average. Georgia does not impose inheritance, estate, or gift taxes.
| Category | Rank | Rank Change | Score |
|---|---|---|---|
| Overall | 18 | 5 | 5.38 |
| Corporate Taxes | 9 | 3 | 5.59 |
| Individual Income Taxes | 16 | 8 | 5.82 |
| Sales Taxes | 18 | 0 | 5.03 |
| Property Taxes | 35 | -1 | 4.72 |
| Unemployment Insurance Taxes | 22 | 2 | 5.23 |
Get facts about taxes in your state and around the US
Cigarette smuggling is costly for states. We estimate that the forgone revenue from smuggled cigarettes totaled more than $4.6 billion in 2024. California lost nearly $1.4 billion in cigarette excise tax collections, and New York missed out on more than $1.2 billion.
5 min read
Imposing sales taxes on rental car companies’ fleet purchases, in addition to the sales and rental car excise taxes levied when those cars are rented, yields double taxation and causes harmful tax pyramiding.
9 min read
In addition to the federal estate tax, which has a top marginal rate of 40 percent, 12 states and the District of Columbia impose estate taxes, while five states levy inheritance taxes.
8 min read