John, Delaware also has no tax on most items. People flock there from neighboring states to purchase some large dollar items, and whatever, tax free. On the one road leading into Delaware, there is a banner going across the road stating "Welcome to Delaware, Home of the Tax Free Shopping."
I believe how Delaware complied with this issue was that as a non resident of Delaware, you are supposed to report the items monetary worth when doing your income tax. No one does, but they covered themselves.

David