With April 15, "Tax Day," just behind us, the Small Business & Entrepreneurship Council (SBE Council) has published the "Business Tax Index 2008: Best to Worst State Tax Systems for Entrepreneurship and Small Business," ranking the states according to the costs of their tax systems for small business start up and growth.
SBE Council President & CEO Karen Kerrigan said, "Entrepreneurs and small businesses have to struggle every day with the costs of taxation, which affect a wide array of decisions, including hiring, investment, expansion, and location. While the federal tax burden and the complexity of that system is quite heavy, state and local taxes can add significantly to that load. The 'Business Tax Index' captures these costs, and provides businesses, investors, and political leaders with a measurement of how the states stack up against each other in this regard."
You can read the full report and visit the "Business Tax Index 2008" state interactive map. Follow the above link and look for the "Business Tax Index 2008" image on the right hand side of the main page to access the full report, summary, and nationwide map of individual state rankings.
SBE Council's "Business Tax Index 2008" pulls together 16 different tax measures, and combines those into one tax score that allows the 50 states and District of Columbia to be compared. Among the taxes included are income, property, death/inheritance, unemployment, and various consumption-based taxes, including state gas and diesel levies.
According to the "Business Tax Index 2008," the 15 BEST state tax systems are: 1) South Dakota, 2) Nevada, 3) Wyoming, 4) Washington, 5) Florida, 6) Alaska, 7) Texas, 8) Colorado, 9) Alabama, 10) Mississippi, 11) South Carolina, 12) Tennessee, 13) Missouri, 14) Ohio, and 15) Virginia.
The 15 WORST state tax systems are: 37) North Carolina, 38) Nebraska, 39) West Virginia, 40) Hawaii, 41) Idaho, 42) Vermont, 43) Massachusetts, 44) New York, 45) Rhode Island, 46) Maine, 47) Iowa, 48) California, 49) Minnesota, 50) New Jersey, and 51) District of Columbia.
Raymond J. Keating, chief economist for SBE Council and author of the report, wrote: "In the end, taxes matter. They matter at the federal, state, and local levels of government. They matter to consumers, entrepreneurs, investors, and businesses. They matter in terms of a state's competitiveness. And they matter when it comes to economic growth and job creation."