State and Local Tax Policy: What are the sources of revenue for state governments?
States collected general revenues totaling nearly $1.6 trillion in 2010. Thirty-seven percent of that revenue came as transfers from the federal government and, to a much smaller degree, from local governments. The remainder came from state taxes, fees, and miscellaneous receipts.
- States received about $576 billion in intergovernmental transfers in 2010, which accounted for nearly 37 percent of their general revenues.
- Sales and gross receipts taxes were the largest source of states’ own tax revenues in 2010, totaling about $340 billion or one-fifth of general revenues.
- Individual and corporate income taxes accounted for about 17 percent of state general revenues in 2010. The individual share totaled a little under $240 billion and the corporate share a little over $37 billion.
- Other taxes, charges, fees, and miscellaneous receipts totaled just over $370 billion in 2010, a little less than one-fourth of general revenues.