Hawaii
Our ranking: Least tax-friendly
State income tax: 1.4% (on taxable income up to $4,800 for married couples filing jointly; on up to $2,400 for married couples filing separately and individual filers) — 8.25% (on taxable income over $48,000 for married couples filing jointly and surviving spouses; on over $96,000 for married couples filing separately and individual filers)
Average state and local sales taxes: 4.35% (but applied to virtually all transactions)
Gas taxes and fees: 48 cents per gallon (varies by county)
The Aloha State is known for its high cost of living — and high taxes. The top tax bracket is an eye-popping 11% (applied to taxable income over $400,000). Also, don’t be fooled by Hawaii’s 4.35% average sales tax rate. Since it’s due on virtually all transactions, the pocketbook effect is severe. A ray of sunshine: Property taxes as a percentage of home value are the lowest in the U.S.
