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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Wyoming VS COUNTRY B Tennessee

Side-by-side analysis of income tax, effective rates, and take-home pay for Wyoming and Tennessee in 2026.

Daniel · CountryTaxCalc Updated June 2026 Tax Comparison 2026
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OVERVIEW
Wyoming and Tennessee are two of the nine US states with no income tax — making this comparison unusual: income tax is not the differentiator. Instead, the key differences are sales tax and property tax. Tennessee has the highest combined sales tax in the United States, with a 7% state rate and local additions averaging approximately 9.55% combined. Wyoming's combined average is approximately 5.36% — well below Tennessee. On a household spending $50,000/year on taxable goods, Tennessee costs approximately $4,775 in sales tax vs Wyoming's $2,680 — an annual difference of approximately $2,095. Tennessee's property tax rate (~0.52%) is close to Wyoming's (~0.53%) — both comfortably below the national average — so property tax is not a meaningful differentiator between the two states. For high-spending households, retirees who buy a lot of goods and services, and businesses with significant taxable purchases, Wyoming's substantially lower sales tax is a meaningful ongoing saving. Tennessee's appeal lies in its lifestyle strengths: Nashville is one of America's fastest-growing cities, with a booming music, healthcare, finance, and tech economy. Memphis offers significant logistics and healthcare industry opportunities. For remote workers choosing between these two no-income-tax states, Wyoming wins on sales and property taxes while Tennessee wins on urban career access and southern lifestyle.
Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

🦬
COUNTRY A
Wyoming
TAX RATE
0%
No Income Tax — Low Sales Tax Too

No income tax; no capital gains tax; 4% state sales tax (~5.36% combined average — among the lowest in the Mountain West); property tax ~0.53% average; no estate tax; mineral revenues fund government

🎸
COUNTRY B
Tennessee
TAX RATE
0%
No Income Tax — But Highest Combined Sales Tax in the US

No income tax on wages or investment income (Hall income tax eliminated January 1, 2021); no capital gains tax; 7% state sales tax (~9.55% combined average — the highest in the US); property tax ~0.52% average; no estate tax; sales tax is Tennessee's primary revenue source

TYPICAL ANNUAL DIFFERENCE
Moving from Tennessee → Wyoming at Both states have 0% income tax; savings come almost entirely from Wyoming's lower sales tax (~4.19 percentage points below TN) — property taxes are close to a wash (Wyoming ~0.53% vs Tennessee ~0.52%)
$0 income tax saving — but $1,000–$2,025+/year in net sales + property tax savings

That's $85–$169/month in net sales + property tax savings at moderate spending levels back in your pocket

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME
🦬 WY TAX
🎸 TN TAX
SAVINGS
10-YEAR
$50,000
$0 income tax; ~$1,246 property (0.53% × $235K home); ~$1,340 sales (5.36% × $25K spending) = ~$2,586 total
$0 income tax; ~$1,222 property (0.52% × $235K home); ~$2,388 sales (9.55% × $25K) = ~$3,610 total
Neither state collects income tax; TN is ~$24/yr cheaper on property tax; WY saves ~$1,048/yr in sales tax = ~$1,024 combined annual advantage at $50K
$9,310
$100,000
$0 income tax; ~$1,590 property (0.53% × $300K home); ~$1,608 sales (5.36% × $30K) = ~$3,198 total
$0 income tax; ~$1,560 property (0.52% × $300K home); ~$2,865 sales (9.55% × $30K) = ~$4,425 total
Neither state collects income tax; TN is ~$30/yr cheaper on property; WY saves ~$1,257/yr in sales = ~$1,227 combined annual advantage at $100K
$11,070
$200,000
$0 income tax; ~$2,650 property (0.53% × $500K home); ~$2,144 sales (5.36% × $40K) = ~$4,794 total
$0 income tax; ~$2,600 property (0.52% × $500K home); ~$3,820 sales (9.55% × $40K) = ~$6,420 total
Neither state collects income tax; TN is ~$50/yr cheaper on property; WY saves ~$1,676/yr in sales = ~$1,626 combined annual advantage at $200K
$14,260
$300,000
$0 income tax; ~$3,710 property (0.53% × $700K home); ~$2,680 sales (5.36% × $50K) = ~$6,390 total
$0 income tax; ~$3,640 property (0.52% × $700K home); ~$4,775 sales (9.55% × $50K) = ~$8,415 total
Neither state collects income tax; TN is ~$70/yr cheaper on property; WY saves ~$2,095/yr in sales = ~$2,025 combined annual advantage at $300K (high spending)
$17,450
$500K capital gain
$0 state capital gains tax (Wyoming has no income tax; no capital gains tax)
$0 state capital gains tax (Tennessee has no income tax; investment income fully exempt since Hall tax repeal in 2021)
Both states have $0 capital gains tax — equal on this dimension. Capital gains do not affect the comparison.
Equal — neither state taxes capital gains
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Wyoming Pros & Cons

+ PROS
  • Much lower sales tax — Wyoming's combined average (~5.36%) is approximately 4.2 percentage points below Tennessee's (~9.55%); Tennessee's 7% state rate plus local additions makes it the highest combined sales tax in the US; a family spending $50,000/year on taxable goods saves approximately $2,095/year in Wyoming
  • Comparable property tax to Tennessee — Wyoming's ~0.53% effective rate is close to Tennessee's ~0.52%; both states keep property taxes well below the national average, so this isn't a meaningful differentiator either way
  • Both zero income tax — Wyoming and Tennessee both have no income tax; the income tax comparison is neutral and does not favour either state
  • No capital gains tax — both states have no capital gains tax; neutral on this dimension
  • Mineral revenues provide budget stability — Wyoming's oil, gas, and coal revenues reduce reliance on sales and property taxes, giving Wyoming more fiscal flexibility than Tennessee's high sales tax structure
− CONS
  • No major metro economy — Wyoming's largest cities (Cheyenne ~65,000, Casper ~57,000) cannot match Nashville's rapidly growing economy or Memphis's logistics hub; career access is dramatically more limited in Wyoming
  • Harsher climate — Wyoming winters are significantly more severe than Tennessee's; Nashville enjoys mild four-season weather; Wyoming experiences harsh cold and significant snowfall
  • Tennessee's food sales tax — Tennessee exempts groceries from the full 7% rate (taxed at 4% state rate); the effective sales tax burden on food spending is somewhat lower than the headline combined rate suggests; Wyoming's advantage on groceries is less than the headline comparison implies
🎸

Tennessee Pros & Cons

+ PROS
  • Nashville's booming economy — Nashville is one of the US's fastest-growing cities; it hosts healthcare (HCA, Vanderbilt Medical), music and entertainment, finance, and tech sectors; the Nashville metro's 2.1M population creates career and business density far beyond Wyoming's cities
  • Both no income tax — Tennessee eliminated the Hall income tax on interest and dividends on January 1, 2021; both states are now fully no-income-tax on all income types; equal income tax position
  • Warmer climate and southern lifestyle — Tennessee's four seasons, live music culture, and proximity to the Smoky Mountains create a lifestyle proposition very different from Wyoming's Mountain West character
  • Lower cost of living than most major metros — Tennessee's affordable housing relative to coastal cities, combined with zero income tax, makes Nashville and Memphis attractive for Northeasterners seeking lower total cost of living
− CONS
  • Highest combined sales tax in the US — Tennessee's combined average of approximately 9.55% is the highest of any US state; the 7% state rate plus local additions (typically 2.25–2.75%) applies broadly to goods and services; a family spending $40,000/year pays approximately $1,676/year more than in Wyoming
  • Property tax roughly on par with Wyoming — Tennessee's ~0.52% effective rate is close to Wyoming's ~0.53%; not a meaningful cost difference between the two states on this dimension
  • High sales tax is regressive — Tennessee's high sales tax disproportionately burdens lower- and middle-income households who spend a higher proportion of income on taxable goods; Wyoming's lower sales tax is less burdensome proportionally
  • Sales tax on food (reduced rate) — Tennessee applies a 4% state rate to groceries (instead of 7%), but the combined rate with local additions can still reach 5–6% on food; Wyoming has no sales tax on certain food items depending on the county
FAQ

Frequently Asked Questions

Does Tennessee have an income tax?

No. Tennessee eliminated its income tax completely on January 1, 2021, when the Hall income tax on interest and dividend income was fully repealed. Prior to 2021, Tennessee taxed investment income (interest and dividends) at 1–2%; wages and salaries had never been taxed at the state level. As of 2026, Tennessee residents pay $0 state income tax on wages, salaries, investment income, capital gains, and retirement distributions. Tennessee and Wyoming are both fully no-income-tax states.

Why does Tennessee have such a high sales tax?

Tennessee has no income tax and relies heavily on sales taxes as its primary state revenue source. The 7% state rate is one of the highest in the US, and when combined with local sales taxes (typically 2.25–2.75%), the combined average reaches approximately 9.55% — the highest combined rate of any US state. Wyoming also has no income tax but uses mineral severance taxes (oil, gas, coal) as a major revenue source, allowing it to maintain a much lower combined sales tax rate (~5.36%).

Which is better — Wyoming or Tennessee — for no-income-tax comparison?

For most households, Wyoming is still the better fiscal choice between the two no-income-tax states, though the gap is narrower than the headline sales-tax comparison suggests: Wyoming's combined sales tax (~5.36%) is approximately 4.2 percentage points below Tennessee's (~9.55%), while property taxes are close to a wash — Wyoming's ~0.53% effective rate is actually a touch above Tennessee's ~0.52%. On a household spending $40,000/year on taxable goods and owning a $400,000 home, Wyoming saves approximately $1,676/year in sales tax but pays about $40/year more in property tax, for a net combined advantage of roughly $1,636/year vs Tennessee. Tennessee wins on climate (warmer), career access (Nashville), and southern lifestyle.

How do sales taxes compare between Wyoming and Tennessee?

Tennessee has the highest combined state + local sales tax average in the US at approximately 9.55%. Wyoming's combined average is approximately 5.36%. The difference of approximately 4.19 percentage points is meaningful: on $30,000/year of taxable spending, Wyoming saves approximately $1,257/year. On $50,000/year of taxable spending, approximately $2,095/year. Tennessee does exempt groceries from the full 7% rate (reducing the grocery rate to 4% state), which partially narrows the comparison for food-heavy budgets.

How do property taxes compare between Wyoming and Tennessee?

Wyoming's effective property tax rate averages approximately 0.53% of market value; Tennessee's approximately 0.52% — essentially the same range, both well below the US national average (~1.07%). On a $400,000 home: Wyoming costs approximately $2,120/year; Tennessee approximately $2,080/year — a difference of only about $40/year, with Tennessee slightly cheaper. Property tax isn't a meaningful differentiator between the two states; Wyoming's real advantage over Tennessee comes from its substantially lower sales tax.

Is Nashville's economy worth paying higher sales taxes vs Wyoming?

For in-person career professionals, Nashville's economy is substantially more diverse and dynamic than any Wyoming city. Nashville hosts major healthcare companies (HCA), the country music industry, finance firms, and a fast-growing tech sector. The additional ~$2,000+/year in sales taxes vs Wyoming may be well worth the career access for professionals in these industries. For fully remote workers who can choose either state without career impact, Wyoming's sales tax advantage is an ongoing annual saving with no offsetting career benefit.
From the brief
NL27%new 2027 rate, down from 30%
DK65.4kkr/mo threshold, cut from 78k
MT1940snon-dom regime unchanged since
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