With Tax Day approaching on April 15 and 66% of Americans saying they believe their current tax rate is too high, the personal-finance company WalletHub has released its report on the states with the Best & Worst Taxpayer Return on Investment in 2026, along with expert insights.
To compile the rankings, WalletHub evaluated 29 metrics measuring the quality and efficiency of state government services across five key areas — Education, Health, Safety, Economy, and Infrastructure & Pollution — while accounting for the wide variation in tax burdens among states.
| States with Best Taxpayer ROI | States with Worst Taxpayer ROI |
| 1. New Hampshire | 41. Louisiana |
| 2. Florida | 42. Vermont |
| 3. South Dakota | 43. Arkansas |
| 4. Missouri | 44. Delaware |
| 5. Ohio | 45. Nevada |
| 6. Georgia | 46. New York |
| 7. Iowa | 47. North Dakota |
| 8. Indiana | 48. Hawaii |
| 9. Utah | 49. California |
| 10. Virginia | 50. New Mexico |
Best vs. Worst
- Red States have a higher taxpayer return on investment, with an average ranking of 20.74, compared with 33.26 for Blue States (1 = Best).
- Indiana has the lowest proportion of major roads in poor or mediocre condition, which is six times lower than in Rhode Island, the state with the highest.
- Maine has the fewest violent crimes per 1,000 residents, which is 7.2 times lower than in Alaska, the state with the most.
- New Hampshire has the lowest infant mortality rate per 1,000 live births, which is 2.9 times lower than in Mississippi, the state with the highest.
To view the full report and your state’s rank, please visit:
https://wallethub.com/edu/
“There can be a tradeoff between how much tax you pay and what you receive in return from the government. Several of the states with the best taxpayer ROI don’t charge any income tax, and residents pay less at tax time while receiving good-quality (though not necessarily the best) government services. At the same time, while people pay more in states that do charge income tax, they may benefit from better infrastructure, education, safety or public health as a result.”
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“New Hampshire is the state with the best taxpayer return on investment, which is due in large part to the fact that it has no income tax. The Granite State’s tax resources have had a good impact on crime prevention and the environment, as the state has the lowest crime rate and the third-lowest air pollution in the country. It has one of the best public school systems as well.”
- Chip Lupo, WalletHub Analyst
Expert Commentary
How can everyday citizens assess the ROI of their local tax dollars?
“Everyday citizens can assess the return on investment of their local tax dollars by looking at tangible outcomes in education, infrastructure, and safety. A key metric is comparing the quality of local schools and the health of roads against the property tax rates paid by the community. In my state, for example, the strong economy and high entrepreneurship rates are often cited as a sign of high tax ROI for business owners. Citizens can also use digital property tax estimators to see exactly how their contributions align with the specific services provided in their immediate neighborhood. Comparing local school quality and infrastructure health against your tax bill is the most direct way to evaluate the value you receive for your money.”
Andrew Burnstine, Ph.D. – Associate Professor, Lynn University
What are the most efficient ways for local governments to mitigate the fiscal impact of inflation?
“Local governments can mitigate the fiscal impact of inflation by adopting a break-glass plan that focuses on bipartisan offsets and freezing non-essential spending. When inflation drives up the cost of infrastructure and municipal salaries, the most efficient response is to pause new tax breaks for special interest groups and focus on projects with high economic multipliers. As William James once noted, the greatest weapon against stress is our ability to choose one thought over another, which applies to fiscal health by choosing long-term sustainability over short-term political spending. By prioritizing essential services and using automated stabilizers, local leaders can maintain stability even when the national economy is volatile. Targeting essential infrastructure and pausing non-critical spending are the most effective ways for local leaders to counteract rising inflationary costs.”
Andrew Burnstine, Ph.D. – Associate Professor, Lynn University
What's the most common way local governments waste taxpayer dollars?
“The most common way local governments waste taxpayer dollars is through systemic inefficiencies and fraud within large programs like Medicaid and SNAP. National reports in 2026 highlight that billions are lost annually to improper payments because states often lack the incentive to audit programs primarily funded by the federal government. Another significant source of waste is pork-barrel spending, in which projects like memorial parks or unnecessary parking lots receive millions in funding despite serving very few people. In some cases, the number of these individual projects has nearly tripled over the last three years, diverting funds away from critical national needs. Systemic fraud in welfare programs and pork barrel projects represents the largest drain on public funds at the state and local levels.”
Andrew Burnstine, Ph.D. – Associate Professor, Lynn University
2026 Tax Resources from WalletHub
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