There are a handful of states with no sales tax. Residents of these states may Check this website be the envy of their neighbors, but businesses located in no-sales-tax states ignore sales tax at their peril: They can still develop an obligation to collect and remit sales tax in other states.
What is sales tax?
Sales tax is a tax on the exchange, sale, or transfer of goods and services. It’s generally added to the retail sales price, collected by the retailer at checkout, and paid by the consumer. Retailers are responsible for remitting sales tax to the appropriate taxing authority and filing sales tax returns.
The majority of states have both state and local sales taxes. Seven states have a statewide sales tax but no local sales taxes.
There are five states with no sales tax at the state level:
Alaska
Delaware
Montana
New Hampshire
Oregon
The states with no statewide sales tax are sometimes referred to as the NOMAD states (“N” for New Hampshire, “O” for Oregon, and so forth).
Some of the states with no sales tax are considered to be tax-friendly states. In its 2025 State Tax Competitiveness Index, the Tax Foundation gave high marks to three of the states with no sales tax. It ranked Alaska, Montana, and New Hampshire third, fifth, and sixth, respectively. Delaware came in at 18; Oregon was 30.
Understanding sales tax in states with no sales tax
All five states with no state sales tax levy taxes on certain transactions. There are local option taxes in Alaska and Montana, for example, and Delaware has a gross receipts tax.
There are also excise taxes in each of these five states. Excise tax is similar to sales tax, but excise taxes apply to specific products (like alcohol, cigarettes, and gasoline). Furthermore, excise tax is typically based on the units or volume sold rather than a percentage of the retail price.
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