states that don't have income tax
Axing Ohio's Income Tax. 1  Budget cuts? 2  The pros and cons of the income tax debate are an issue of dollars and sense -- how to make the budget dollars work if the income tax is gone and what strategy makes the most sense. Seven states have no income tax: Alaska, Florida, Nevada, South Dakota, Texas, Wyoming and Washington. Two others don't tax wages, but do tax interest and dividend income: New Hampshire and Tennessee. Data from the Tax Foundation, a recent roundup by USA Today and other sources help to break down how those nine states pay their bills.