New Hampshire is typically known as a low tax state. Although it has higher than average property taxes, it does not tax income earned from work and does not have a sales tax. However, New Hampshire does have a lesser known tax on income, specifically an interest and dividends tax. If you've lived in NH your whole life and haven't heard of this tax, you're not alone. This tax does not apply to everyone, but with short-term interest rates at their highest level of the past decade, it's possible that this will apply to more and more people living in the Granite State.