TX
No State Income TaxHigh Property TaxLast reviewed June 2026
Texas State Income Tax 2026: There Is None
Texas has no personal state income tax and is constitutionally prohibited from imposing one without voter approval. Texas funds government services through sales tax (6.25% state, up to 8.25% with local), property taxes (averaging 1.6-1.8% of assessed value), and the franchise tax on businesses.
Texas Tax Overview 2026
| State income tax | None (0%) |
| State sales tax | 6.25% |
| Combined sales tax (with local) | Up to 8.25% |
| Average property tax rate | ~1.60% of assessed value |
| Franchise tax (businesses) | 0.375% to 0.75% of revenues (varies) |
| Estate/inheritance tax | None |
| Capital gains tax | None (no income tax) |
The Full Texas Tax Breakdown Is at Our Sister Site
noincometaxstates.com is dedicated to the 9 zero-income-tax states. The Texas page covers total tax burden comparison, property tax by county, relocation considerations, retirement income, and cost of living context. This is the deep dive this page is intentionally not.
Full Texas breakdown at noincometaxstates.com →Texas Tax: FAQs
Does Texas have a state income tax?
No. Texas has no state income tax. The Texas Constitution prohibits a personal income tax without a voter referendum. In 2019, Texas voters approved a constitutional amendment that makes it even harder to enact an income tax, requiring both a two-thirds vote in the legislature and a majority vote by the public.
What does Texas tax instead of income?
Texas funds state and local government primarily through property taxes, sales tax, and the franchise tax (a business tax). The state sales tax rate is 6.25%, and local rates can add up to 2% more, bringing the combined rate to 8.25% in many areas. Texas property taxes average around 1.7% of property value, among the highest in the US.
Is Texas actually cheaper to live in because of no income tax?
It depends on your income and homeownership status. High earners who rent tend to benefit significantly from no income tax. Homeowners in Texas face among the highest property tax bills in the country. A $400,000 home in Austin might carry a $7,000-9,000 annual property tax bill. For a full comparison of total tax burden, see the detailed analysis at noincometaxstates.com/texas.