The motto “Don’t Mess With Texas,” should be changed to “We Got Your Back, Taxpayers!” Voters in the Lone Star State have approved three state constitutional amendments outlawing taxes. Following the November 2025 election, the Lone Star State can never impose taxes on capital gains, estates or inheritances, or securities transactions.
You don’t see any California politicians cutting, or eliminating taxes. In fact, California has the highest taxes of any state with a marginal personal income tax rate of 14.4%, and they are looking to raise taxes again. A ballot initiative proposed by a healthcare workers’ union would take aim at the Golden State’s richest residents with a one-time, 5% tax on assets of individuals with net worth over $1 billion. This would mean pursuing assets like stocks, artwork and intellectual property rights, rather than income. The union has framed the added tax as necessary to cure to the anticipated $30 billion annual state budget shortfall. The union says the proposed tax is “fair” because “billionaires have used state resources to create their enormous wealth…”
Texas does not have a state individual or corporate income tax. Its primary taxes are a state sales and use tax of 6.25%, which can reach a maximum combined local rate of 8.25%, and local property taxes that vary by jurisdiction.
Winner: Texas
