What Is the Diaper Tax and Which States Have It?
Explore how applying sales tax to diapers creates a complex policy debate, balancing family costs against state revenue needs across the U.S.
The term “diaper tax” is misleading, as it is not a special tax on diapers. Instead, it refers to the common practice in many states of applying general sales tax to diapers. This application of tax law to what many consider an essential item has become a subject of legislative debate, as the financial impact on families with low incomes is a social and economic concern.
State-by-State Sales Tax Application
The taxability of diapers is determined at the state level, resulting in a patchwork of laws. As of early 2025, 24 states still apply their standard sales tax to diapers. These taxes range from 4% to over 7% at the state level, and many cities and counties add their own local sales tax, increasing the final cost. A family in a state with a 7% sales tax could pay over $70 in taxes annually on diapers, based on an estimated yearly cost of $1,000 per child.
A growing number of states have moved to exempt diapers from sales tax. This group includes states with no statewide sales tax, such as Oregon, Montana, and New Hampshire. Other states like Florida, Maryland, and Colorado have passed specific legislation to exempt diapers. Recent changes include Nevada, where voters made both adult and infant diapers tax-exempt starting January 1, 2025. Alabama also passed a temporary sales tax exemption on diapers, effective from September 2025 through August 2028.
The tax treatment of adult diapers often mirrors that of infant diapers, but not always. In states like Nevada, the exemption explicitly covers diapers for all ages. In other jurisdictions, the rules can be more complex. For example, in Ohio, children’s diapers are exempt, but adult diapers are only exempt when sold with a prescription for a Medicaid recipient with an incontinence diagnosis. This distinction highlights the varying interpretations of whether diapers are a consumer good or a medical necessity.
Arguments for Tax Exemption
Advocates for exempting diapers from sales tax argue that these items are a health necessity, not a luxury purchase. Proponents argue that families cannot choose to forgo buying diapers, making them a non-discretionary expense similar to groceries or prescription drugs. The financial pressure is significant, as infants may require eight to ten diapers a day, creating a burden on low-income households.
The inability to afford an adequate supply of diapers can lead to public health issues. Children left in soiled diapers for extended periods are at a higher risk for skin infections and urinary tract infections. Beyond health impacts, a lack of diapers can create barriers to work and education. Many childcare facilities require parents to provide a supply of disposable diapers, and without them, a parent may be unable to go to work or attend school.
The sales tax on diapers is viewed as a regressive tax that disproportionately affects the most vulnerable families. The savings from an exemption, while small on a per-purchase basis, can accumulate to allow a family to purchase nearly a month’s worth of additional diapers over a year. This relief can free up household funds for other essential needs and reduce health risks.
Arguments Against Tax Exemption
The primary concern against creating specific sales tax exemptions is the direct loss of tax revenue, which funds public services like education, infrastructure, and public safety. For example, the exemption in Nevada was estimated to reduce state general fund revenues by $5.8 million for fiscal year 2025, with a total projected revenue reduction of $460.9 million by the end of 2050.
Another argument involves the “slippery slope” theory of tax policy. Creating a carve-out for diapers can open the door for groups to demand similar exemptions for other goods they deem essential, such as soap or toothpaste. This can lead to an erosion of the sales tax base, making the tax system more complex and potentially forcing states to raise the overall sales tax rate on remaining goods.
Finally, some policymakers contend that the tax code is not the most efficient tool for providing social assistance. They argue that a broad-based sales tax with a low rate is more stable than a system with numerous exemptions. Instead of carving out specific products, they suggest direct financial assistance through programs like Temporary Assistance for Needy Families (TANF) or state-funded diaper banks is a more effective way to help low-income families.