Don't Mess With Taxes

It's my second favorite holiday, National Ice Cream Day! Yep, it's a sorta real holiday, occurring every year on the third Sunday in July as part of National Ice Cream Month. 

So many ways to enjoy ice cream on National Ice Cream Day and any/every day. (Image courtesy GIFS for Humans Tumblr).

National Ice Cream Day became official in 1984 when then President Ronald Reagan signed a proclamation declaring its existence. And even though the holiday was the brainchild of the dairy industry, I can't think of many more things as worthy of celebration than this beloved and iconic treat. 

Few of us, though, need an official government sanction to dive into a pint or half-gallon or gallon (yes, that's me with the spoon in that carton!) of our favorite frozen treat on any day of the year.

Worth the tax: For most of us, when we buy our ice cream at our local grocery store, we don't pay sales tax on it or any of the other food items in our cart. Some states that do tax groceries do so at a lower tax rate.

Yes, the taxes on food can be as complicated as an elaborate recipe's directions, as I noted in an earlier post warning that if you're hungry, you better also have an appetite for taxes.

And if you go to your favorite local ice cream parlor, you'll probably pay tax on your tasty treat.

But if you live in one of the five states with no statewide sales tax, things are much easier.

So where are those sales-tax-free states? Spread across the country, from Alaska, Montana and Oregon out west to New Hampshire and Delaware on the eastern side of the United States.

Here's the scoop on the lack of sales tax in those five locales. The five's collective tax stance today also earns them this week's By the Numbers honor.

ALASKA is the only state that doesn't collect any personal income tax or a statewide sales tax. However, the Last Frontier does give individual municipalities latitude when it comes to setting their own local sales tax rates. Some currently are as high as 7.5 percent. A few years ago, some state lawmakers wanted to enact a 3 percent statewide sales tax to make up for Alaska's financial problems when oil prices, on which the state relies for most of its revenue, were tanking. But even in dire financial circumstances, Alaskans pride themselves on being the only state with no state income or sales tax and the new tax attempt failed.

NEW HAMPSHIRE follows through on its state motto "Live Free or Die" when it comes to taxes. On the income side, it only taxes dividend and interest earnings and it has no statewide or local sales taxes. But beware, visitors, because the Granite State does add a 9 percent sales tax to the price of your hotel room and rental cars, as well as to restaurant meals. Since that ice cream sundae you get for dessert when you eat out is taxed, you might want to wait and make yourself one when you get home.

MONTANA has no sales tax, but certain communities in the Treasure State that are home to tourist-popular resort activities (think skiing, hunting and fishing) are allowed to add a local-option sales tax of up to 3 percent. Like the meals-lodging-rental car levy in New Hampshire, the Montana sales tax burden is born largely by folks who don't live there, always a smart move for elected officials.

DELAWARE often is referred to as the United States' tax haven state because of its incorporation rules. On the individual tax side, the First State doesn't collect a sales tax from consumers, but is does levy a gross receipts tax on businesses, ranging from 0.1037 percent to 2.0736 percent depending on the business activity. That corporate tax, say those who oppose it, generally is baked into production costs, meaning that consumers essentially pay a hidden sales tax on the retail products they purchase.

OREGON doesn't collect a statewide sales tax, but Beaver State counties and cities are allowed to impose their own local levies. Last year, officials of Ontario in far western Oregon proposed a 1 percent sales tax to help the small town meet its expenses. Residents, however, fought back, forcing a vote on the tax. The proposal was rejected in Ontario's election in May.

If you don't live in one of these states, you still might be able to get a tax-free treat today. How? Several businesses are again offering totally free ice cream on National Ice Cream Day. Get the scoop from Money, Travel + Leisure and USA Today. 

Personally, I don't worry about taxes when it comes to ice cream this or any day. I love it so much that I'll buy ice cream on all 365 days, 366 in Leap Years, tax or no tax. It's worth it!

A version of this post originally appeared on July 17, 2016.

You also might find these items of interest:

• Beer excise taxes across the United States
• City and other local taxes add to overall sales tax takes
• Soda taxes go flat in California, possible in Washington State