WASHINGTON, June 29, 2016 /PRNewswire-USNewswire/ -- With 46 of the 50 states beginning new fiscal years on July 1, the Small Business & Entrepreneurship Council (SBE Council) today published the "Small Business Tax Index 2016: Best to Worst State Tax Systems for Entrepreneurship and Small Business." The study ranks the 50 states according to the costs of their tax systems for entrepreneurship and small business.
View the" Small Business Tax Index 2016" interactive map here.
Raymond J. Keating, chief economist for SBE Council and author of the report, said: "With most states kicking off their new budget years on July 1, one of the big question for small businesses is: How heavy is the tax burden in our state? That is, how heavy are the governmental burdens placed on entrepreneurs and investment, especially taxes?"
SBE Council's "Small Business Tax Index 2016" pulls together 25 different tax measures, and combines those into one tax score that allows the 50 states to be compared and ranked. Among the taxes included are income, capital gains, property, death, unemployment, and various consumption-based taxes, including state gas and diesel levies.
According to the "Small Business Tax Index 2016," the best ranking state tax systems include: 1) South Dakota, 2) Nevada, 3) Texas, 4) Wyoming, 5) Washington, 6) Florida, 7) Alabama, 8) Ohio, 9) Colorado, 10) Alaska, 11) North Carolina, 12) Indiana, 13) Arizona, 14) Michigan, and 15) Utah.
Meanwhile, those at the bottom include: 40) Nebraska, 41) Connecticut, 42) Maine, 43) Oregon, 44) Vermont, 45) New York, 46) Hawaii, 47) Iowa, 48) Minnesota, 49) New Jersey, and 50) California.
11 States Have Improved Their Tax Climates
According to the report there is some good news. Compared to last year's index, 11 states have improved their tax climates by reducing their personal or corporate income tax rates, or eliminating their death tax.
In the report, Keating writes about the importance of tax policy and the need for states to remain competitive to encourage investment and entrepreneurship: "When it comes to state and local taxes – as well as levies at the federal level – the direction that policy should be pointed in is clear. Keep the overall tax burden low. In the end, if the tax burden is light on economic risk taking, then that will be good news for entrepreneurship, small business growth, investment, economic and income growth and job creation in each state."
SBE Council is a nonpartisan, nonprofit advocacy, research and education organization that works to protect small business and promote entrepreneurship. For nearly 25 years, SBE Council has advanced key policies and initiatives to strengthen the ecosystem for startups and small business success. To learn more, visit www.sbecouncil.org. Follow us on Twitter: @SBECouncil
Contact: Raymond Keating
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SOURCE Small Business & Entrepreneurship Council