Texas and Alaska raise so much money from taxes on the extraction of natural resources that they do not have to impose individual income taxes. This type of tax is known as a

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A severance tax is a tax on natural resources extracted from the ground or water. Texas and Alaska generate significant revenue through taxes on oil, gas, and other natural resources, which allows them to avoid imposing individual income taxes. This type of tax is often used by states with rich deposits of natural resources to fund government programs and services.

Texas and Alaska Raise So Much Money from Taxes on the Extraction