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Tuesday, October 9, 2012

2013 Business Tax Climate: Chilliest in Blue States

The Tax Foundation today released the 2013 State Business Tax Climate Index (10th ed.) which ranks the fifty states according to five indices: corporate tax, individual income tax, sales tax, unemployment insurance tax, and property tax. Here are the ten states with the best and worst business tax climates:

1

Wyoming

41

Maryland

2

South Dakota

42

Iowa

3

Nevada

43

Wisconsin

4

Alaska

44

North Carolina

5

Florida

45

Minnesota

6

Washington

46

Rhode Island

7

New Hampshire

47

Vermont

8

Montana

48

California

9

Texas

49

New Jersey

10

Utah

50

New York

Interestingly, all ten of the states with the worst business tax climates voted for Barack Obama in the 2008 presidential election, and five of the ten states with the best business tax climates voted for John McCain (and eight of the ten voted for George Bush in 2004).

Index

http://taxprof.typepad.com/taxprof_blog/2012/10/2013-business.html

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Comments

An interesting side note is that the states with a more favorable tax climate have, on average, lower unemployment while the opposite is true of those with less favorable climates. The outliers are Nevada which, while listed as #3 has 12.1% unemployment and Vermont which is listed at #47 but has 5.3% unemployment.

Posted by: Dan Irving | Oct 9, 2012 3:54:51 PM

Finally we have a definitive study which explains why Wyoming and South Dakota are meccas for so many businesses, including innovative corporations (especially high tech and biotech) and why places like California and New York fail to attract businesses and innovators.

Posted by: 2L | Oct 9, 2012 4:07:58 PM

take a look at the regional data in the PWC report...

https://www.pwcmoneytree.com/MTPublic/ns/nav.jsp%3fpage=notice&iden=B

Posted by: LV | Oct 9, 2012 5:33:25 PM

Very definitive, 2L. I wish my state which gets 5% of its revenue from CIT would imitate that pro-business mecca New Hampshire, and get 30% of its revenue from CIT based on this definitive study. 8.5% rate, double weighted sales factor evidently not many other CIT deductions.

Posted by: jimharper | Oct 9, 2012 8:42:06 PM

I don't think the study is keeping up with the evolution of state tax policies. In WA the state taxes businesses on revenue not profits. How can it be in top twenty let alone #6?

Further, WA now has a destination based sales tax. As a business, if you're out in Ephrata and you sell a product to a company in Seattle, you pay Seattle sales tax not Ephrata's. Further, for that honor you have to pay Seattle B&O tax, other taxes, and register as a business in Seattle, which means adhering to all of deep blue labor laws the people in Seattle can dream up. ( Employ at least five people? You must provide paid sick leave for all of your workers! )

I suspect these kinds of shenanigans weren't evaluated by the Tax Foundation.

Posted by: oddhan | Oct 10, 2012 11:24:47 AM

As a 53 year old life long resident of California, the most amazing thing about our situation is the ability of the liberal chowderheads to deny that back when California was a conservative state,life was always getting better; now that the communist liberals have achieved so much destruction of the division of labor, and imposed their psychotic and megalomaniacal vision of environmentalism, they expect us to think things are better now than they were then because now we have gay marriage and hi speed rail.

We are friggn' doomed, I tell you. I cannot believe that people this stupid, this crazy, and this evil, are going to somehow pull of their flat spin and save themselves. Kalifornia is going to become so bad that people will start moving to South Africa to escape to a better life, relatively.

Posted by: James Solbakken | Oct 10, 2012 3:04:49 PM