Do Montana, Oregon, Alaska, Delaware & New Hampshire Have Sales Tax, Or Plan To?

If you’ve ever Googled anything about sales tax (and if you’re here, that’s a safe bet), you’ve likely stumbled across one of the quirkiest facts in U.S. taxation: five states don’t impose a general state sales tax. These so-called NOMAD states—New Hampshire, Oregon, Montana, Alaska, and Delaware—are unique outliers in the American tax landscape.

But will that golden sales tax-free status hold forever? Maybe, maybe not.

Lately, at least one of these states has been gingerly eyeing a shift toward sales tax adoption. In others, the usual drivers of fiscal stress—rising property tax complaints, budget gaps and public service demands—continue to keep the conversation alive in policy circles.

In this article, we take a closer look at the states with no sales tax, why they chose this path in the first place, and whether the rules may begin to shift in the near future.

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If you’re wondering why states like Montana, Oregon, and Delaware don’t have a sales tax, the reasons are a mix of history, politics, and economics:

Alternative Revenue Systems

Every “no sales tax” state has found other ways to pay the bills:

• Oregon leans on its robust income tax system, with rates ranging from 4.75% to 9.9%.
• Delaware fills the gap with business-focused taxes, most notably a Gross Receipts Tax (GRT).
• Alaska funds government operations through natural resource royalties on oil, gas, and mining.
• New Hampshire and Montana rely heavily on property taxes to support schools and local services.

These examples aren’t exhaustive, but they illustrate a key point: sales tax is only one of many revenue options, and these states have historically chosen different paths.

Political Culture

In some states, sales tax resistance is baked into political identity.

New Hampshire is the clearest example. Longstanding anti-tax traditions—including pledges by politicians—make sales tax proposals political kryptonite. These are promises aren’t symbolic; they shape real policy outcomes and limit what lawmakers are willing to propose.

Consumer & Business Appeal

Being sales tax -free is also a powerful marketing tool.

States like Delaware and Oregon attract shoppers from neighboring states with higher taxes. The Christiana Mall in Newark, Delaware attracts visitors from Maryland, New Jersey, New York, and Pennsylvania looking to save money with tax-free purchases. New Hampshire similarly promotes its lack of sales tax to consumers in Massachusetts, Vermont, and Maine.

In these cases, no sales tax can equal competitive advantage.

Regressive Tax Concerns

Sales taxes are often criticized as regressive, meaning they consume a larger percentage of income for lower-income households than for wealthier ones. That concern has slowed adoption in states that prioritize progressive tax structures. Montana, in particular, frequently raises this issue when sales tax proposals resurface.

Montana: An Active Discussion

Montana currently has no state or local general sales tax, but there is increasing discussion about introducing one—or at least a local option—to help with fiscal pressures and soften other tax burdens like property tax.

Here’s the big hook: Montana’s property taxes, which continue to rise. Residents and local leaders have been debating whether a sales tax might offset property tax burdens that fund schools and services—a perennial hot potato in state politics.

Economists at the University of Montana’s Bureau of Business and Economic Research recently spotlighted potential impacts of a sales tax at January 2026 seminars across Helena, Missoula, Billings and more. The core trade-offs discussed:

• A general sales tax could raise revenue and help reduce property taxes.
• At the same time, it would also likely be regressive, putting a larger relative burden on lower-income households.

Montana voters have rejected sales tax proposals before—most notably in 1971 and 1993—and public support remains lukewarm. Some policymakers argue that only a tightly structured approach, such as a local-option sales tax or constitutional limits requiring property tax relief first, would have any chance of success.

For now, Montana’s sales tax debate remains just that: a conversation, not an imminent policy shift.

Alaska: Statewide Sales Tax on the Table?

Alaska sales tax discussions are also gaining attention.

Alaska’s tax system is famously unusual: no state individual income tax, no state sales tax, and a Permanent Fund Dividend that pays eligible residents each year. Still, local municipalities impose sales taxes, and early SB 277 legislation proposes a statewide sales and use tax with seasonal rates (4% in summer, 2% in winter). If enacted, it would mark a major shift in Alaska’s fiscal model.

However, early reactions in legislative hearings have been lukewarm to negative, indicating that the governor’s fiscal plan—with its sales tax components—may lack sufficient support. Public testimony in Alaska reportedly skewed strongly against sales tax expansion.

So while Alaska sales tax talk is more active than in other NOMAD states, it’s far from a done deal and faces considerable political headwinds.

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Delaware, New Hampshire and Oregon: Still Staunchly Sales Tax-Free

While Montana and Alaska periodically flirt with broader consumption taxes, Delaware, New Hampshire, and Oregon remain firmly planted in the “no sales tax” camp—and for each of them, the resistance is more than just habit. It’s structural, political, and deeply cultural.

Delaware

Delaware doesn’t charge a state sales tax—or local sales taxes—and instead relies on corporate and business taxes to generate revenue. Tax-free shopping is also a cornerstone of its retail economy, particularly near state borders.

There’s no serious current discussion about adopting a sales tax in Delaware, and any proposal would have to overcome the state’s longstanding preference for business-friendly tax structures.

New Hampshire

What about sales tax in New Hampshire? Simply put: it doesn’t exist—and probably won’t. New Hampshire maintains a political tradition known as “The Pledge,” where candidates vow not to support broad-based taxes like income or sales taxes.

That commitment is deeply rooted in state politics and has kept broad consumption taxes off the books for generations.

Oregon

Oregon continues to resist a statewide sales tax, and has done so for decades. The state does not impose a general sales tax and also does not allow localities to impose one. Local governments instead rely on income taxes and other levies.

Although occasional ideas to adopt a sales tax surface—usually tied to debates about balancing the state budget or diversifying revenue—none have landed on ballots or advanced far in the legislature.

Here’s how the debate shakes out when proponents and opponents step up to the podium:

Pros of Adopting a Sales Tax	Cons of Adopting a Sales Tax
A broader, more stable revenue base	Regressive impact on lower-income households
Potential property tax relief, particularly in Montana	Deep political resistance in states like New Hampshire and Delaware
Ability to capture revenue from tourists and out-of-state shoppers	Administrative complexity and compliance costs

For now, businesses operating in states with no sales tax enjoy simpler compliance and lower transaction friction—but they still must navigate other taxes, including income, property, excise, and business-specific taxes.

Consumers benefit from tax-free shopping, but the trade-off often comes in the form of higher property taxes or alternative levies that ultimately fund public services.

Bottom line: Sales tax in the NOMAD states remains behind locked doors—but a few states are eyeing the key. Whether those doors open will depend on politics, economic pressure, and how compelling the case for change becomes.

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