COLUMBUS, Ohio, May 11, 2011 /PRNewswire/ -- Running an international business can be a logistical challenge of high overhead and never-ending costs to import or export foreign goods. Many U.S. companies have moved operations overseas to lower costs associated with transportation of components and finished products. As competition becomes more global, the ideal business location provides access to markets necessary for companies to maximize flexibility while reducing supply chain costs.
Companies find locating their business in Ohio provides both tactical and strategic benefits, such as an efficient transportation system and established supply chain, as well as benefits garnered from locating in a Foreign-Trade Zone.
In total, there are 10 Foreign-Trade Zones in Ohio, making the state an ideal location for global businesses to lower costs and boost profits in a 21st century economy. Foreign goods may be admitted to an Ohio Foreign-Trade Zone without being subject to customs duties or other import-related taxes.
"Ohio is committed to reducing operating costs and leveling the playing field for global companies based in the state," said Ronald DeBarr, president and CEO of the Northeast Ohio Trade & Economic Consortium, which administers 26 sites in Foreign-Trade Zone 181 in Northeast Ohio. "Our foreign-trade zone sites are strategically placed to link together a strong multimodal logistics infrastructure, enabling Ohio companies to more effectively manage their global supply chain and enjoy the same economic benefits of those companies located offshore."
Costs associated with accessing foreign markets to import or export goods can be high for an international company. Locating in a U.S. Foreign-Trade Zone allows companies to bring goods into the site duty-free and without formal customs entry.
International companies located in Ohio realize all the benefits of locating in a Foreign-Trade Zone, along with a lower cost of doing business with easy access to profitable markets, a central location and world-class logistics infrastructure.
Companies located in Ohio are able to access global markets while keeping overhead costs down and increasing profits. Foreign-Trade Zones are secured sites where goods can be stored, repackaged, assembled and manufactured. The zones offer companies the ability to reduce, defer or eliminate duties, and stored inventory is not subject to import quotas. Products imported into these zones are exempt from duty until they enter the U.S. marketplace, and duty is never paid if the products are re-exported.
The state's world-class logistics capabilities help companies reduce operating costs by getting components and finished goods quickly to their destination anywhere in the U.S. or around the globe through an extensive logistics management network. Ohio is centrally located within 600 miles of 60 percent of the U.S. and Canadian population and is within a one-day drive of 70 percent of North America's manufacturing capacity.
"Foreign-Trade Zone #138, which serves companies in 25 Central Ohio counties, is the first location in Ohio to take advantage of new federal guidelines that make it possible for companies to reap the benefits of being in a Foreign-Trade Zone in as little as 30 days," said Angie Atwood, administrator for Foreign-Trade Zone #138, which is headquartered in the Rickenbacker Inland Port. "Serving as the gateway for the Ohio Valley, this inland port includes cargo-dedicated Rickenbacker International Airport and a rail-truck intermodal terminal, all supported by a mix of premier freight forwarders, consolidators, Customs brokers and third-party logistics providers with direct access to major U.S. interstates."
Ohio's established logistics infrastructure includes multi-modal and inter-modal networks allowing efficient import and export of products—180 public airports, eight interstate highways, 36 freight railroads and 25 waterfront ports.
"Ohio has proactively redesigned its business climate to deliver a perfect balance between access to mission-critical resources and low overhead costs," said Ed Burghard, executive director of the Ohio Business Development Coalition, the nonprofit organization that markets the state for capital investment. "Strategic tax reform and economic development incentives encourage global success and make the state an ideal location to profitably compete in the global marketplace."
In fact, a recent report by the Quantitative Economics and Statistics Practices (QUEST) of Ernst & Young in conjunction with the Council On State Taxation (COST) ranks Ohio as third in the nation for friendliest tax environment.
The most notable changes to Ohio's tax system include the elimination of two very burdensome business taxes – the corporation franchise tax and the tangible personal property tax. These taxes were replaced by a new, 0.26 percent Commercial Activity Tax (CAT), which applies only to in-state sales.
"If a business were to ship 100 percent of its sales out of Ohio, it would pay zero CAT," said former Ohio Tax Commissioner Thomas M. Zaino, J.D., CPA, now member in charge of the Columbus office of the McDonald Hopkins LLC law firm. "This increases Ohio's appeal to companies that export goods out of the state or country."
The advantages Ohio offers positions the state as an international leader for business success in the 21st century global marketplace. Companies continue to discover the benefits of investing in Ohio, finding a preferred location for capital investment, a competitive business environment and a perfect balance between business pursuits and personal aspirations.
"Ohio's success is not solely dependent on the strength of its business advantages. It's about Ohio's promise of work-life balance," Burghard added. "Low-cost, low-stress communities and short commutes create the State of Perfect Balance, where you can achieve both professional and personal success without sacrificing one for the other."
About the Ohio Business Development Coalition
The Ohio Business Development Coalition is a nonprofit organization that provides marketing strategy and implementation to support Ohio's economic development efforts. For more information, visit www.ohiomeansbusiness.com.
SOURCE Ohio Business Development Coalition