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How do states with no personal income tax raise money for public services?

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User Nieves
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Final answer:

States with no personal income tax raise money for public services through sales tax, property tax, corporate tax, excise tax, and lotteries.


Step-by-step explanation:

States with no personal income tax rely on other sources of revenue to fund public services. Some common ways these states raise money include:

  1. Sales Taxes: They impose higher sales tax rates on goods and services purchased within the state.
  2. Property Taxes: They collect taxes on real estate, such as homes and commercial buildings.
  3. Corporate Taxes: They tax profits earned by businesses operating within the state.
  4. Excise Taxes: They impose taxes on specific goods, such as alcohol, tobacco, and gasoline.
  5. Lottery: Some states generate revenue from state-run lotteries.

By diversifying their sources of revenue, these states can fund public services without relying on personal income tax.


Learn more about State taxation and funding for public services

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User Uresh K
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