No State Has Ended Personal Income Taxes Since 1980, But Mississippi And Kentucky May Change That

About 45 years have passed since a U.S. state last eliminated its income tax on wages and salaries. But with recent actions in Mississippi and Kentucky, two states now are on a path to do so, if their economies keep growing.

The push to zero out the income tax is perhaps the most aggressive example of a tax-cutting trend that swept across states as they rebounded from the COVID-19 pandemic with surging revenues and historic surpluses .

But it comes during a time of greater uncertainty for states, as they wait to see whether President Donald Trump's cost cutting and tariffs lead to a reduction in federal funding for states and a downturn in the overall economy.

Some fiscal analysts also warn the repeal of income taxes could leave states reliant on other levies, such as sales taxes, that disproportionately affect the poor.

Which governments charge income tax?