Ah, Tax Day—the annual deadline for Americans to file their federal income tax returns or pay any taxes owed to the IRS. While federal taxes are fairly uniform (based on income), state taxes vary.
This year, Americans across the country are probably paying closer attention to those rates. Many families are still struggling with high prices and the rising cost of living. Thankfully, state think tanks across this Network—close and responsive to the needs of the people in their communities—are helping lead the charge for lower rates. These organizations are working with state and local leaders to provide relief so Americans can keep more of their hard-earned money.
As Americans file their taxes, let’s dive into which states are advancing these reforms.
If you are an affiliate of State Policy Network and have a reform to add to this list, please email Camille walsh at walsh@spn.org.
In April, the Peach State lowered the flat tax rate on personal and corporate income to 5.19%. But according to the Georgia Public Policy Foundation, that may not be enough. Georgia’s neighbors are aggressively cutting their rates—giving them a leg up in the race for jobs and economic growth.
Kansas recently passed a bill that creates a mechanism for lowering individual and corporate income tax rates over time. The Kansas Policy Institute explained that if certain conditions are met, the personal income tax will eventually flatten to 4%.
As the price of owning a home becomes more expensive, Florida is exploring reducing and even eliminating property taxes altogether.
Thanks in part to the Mountain States Policy Center and Idaho Freedom Foundation, Idaho passed a law that lowers the state’s personal and corporate income tax rates from 5.695% to 5.3%. The state also increased the grocery tax rebate, which will help residents offset the sales tax they pay on their groceries each year. In addition, the Gem State gave Idahoans $100 million in property tax relief.
The Indiana Legislature passed legislation on April 15 that would save homeowners $1.2 billion in property taxes over three years.
Mississippi passed legislation on March 27 that phases out the state’s income tax. Empower Mississippi and the Mississippi Center for Public Policy were instrumental in this win for Mississippi families and businesses. Empower and MCPP highlighted the many benefits of this reform, including boosting economic growth, removing barriers to work, and making the state more competitive.
The Show-Me State is considering legislation that would eventually lower Missouri’s top individual income tax rate to 3.7% (from 4.7% today). Income tax reform is a top priority for the Show-Me Institute. In their 2025 Blueprint report, the Institute explained the problems with Missouri’s damaging reliance on income taxes and encouraged state leaders to sunset the income tax completely.
Montana is considering several property and income tax relief bills. Tax relief is a key priority for the Montana Governor, and the Frontier Institute has been encouraging lawmakers to cut taxes and ease the financial burden on Montana families.
North Carolina lawmakers released a proposal on April 14 that would cut personal income tax rates to 3.49% in 2027 and 2.99% in 2028. The John Locke Foundation has long been a proponent of lowering tax rates and recently highlighted how North Carolina’s historic tax cuts in 2013 helped the state reduce poverty at the fifth fastest rate in the nation.
Like Mississippi’s new law, Oklahoma is considering a bill that would gradually eliminate the income tax. The measure passed the Oklahoma House on April 10. The Oklahoma Council of Public Affairs’ president Jonathan Small praised lawmakers for advancing this reform and pointed out the income tax is a tax on work and investment, which makes it more harmful to economic growth and job creation than most taxes.
South Carolina is considering lowering its income tax rate to 3.99% for everyone in 2026, regardless of their income. The rate currently ranges from 0 to 6.2%.
The Palmetto Promise Institute and The Buckeye Institute recently released a report that found the proposal would grow the South Carolina economy by $240 million in the first year alone.
In a piece for Governing, the South Carolina Council’s Sam Aaron pointed out that the Palmetto State’s income tax rate is the highest in the Southeast and encouraged state lawmakers to prioritize lowering that rate.
South Dakota passed a law in March that will slow down how fast property taxes can go up for homeowners.
Utah lowered its income tax rate from 4.55% to 4.5%. The Libertas Institute noted that while an even larger cut would be preferable, any reduction in Utah’s income tax is a step in the right direction.
