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Foundation: Conn.'s business tax climate ranks 40th out of 50
Waterbury Republican-American ^ | January 26, 2012 | David Krechevsky

Posted on 01/26/2012 5:14:32 AM PST by Graybeard58

Connecticut has the worst property tax rates in the country, helping to make its business tax climate rank among the worst nationwide, according to a new report released Wednesday.

The 2012 State Business Tax Climate Index, produced by the nonprofit, nonpartisan Tax Foundation based in Washington, D.C., ranks Connecticut's business tax climate 40th, one spot above the nation's 10 worst. The state's rank is unchanged from last year.

Including Connecticut, five of the six lowest-ranked states are in the Northeast -- New Jersey (50th), New York (49th), Vermont (47th) and Rhode Island (46th). California was ranked 48th.

Wyoming's business tax climate is ranked No. 1 by the index, followed in order by South Dakota, Nevada, Alaska and Florida.

The foundation ranks each state in five categories — corporate tax, individual income tax, sales tax, unemployment insurance tax and property tax -- before calculating the overall rankings. The rankings were based on tax rates in place on July 1, 2011, the start of the 2012 fiscal year.

Wyoming is ranked best in two categories, corporate tax and individual income tax. It ranked 13th in sales tax, 29th in unemployment insurance tax and 34th in property tax.

Connecticut's corporate tax was ranked right in the middle, at 25th, but the state ranked no higher than 30th in any other category. That includes the property tax, which was ranked the nation's worst, below New Jersey (49th), Tennessee (48th), Massachusetts (47th) and Rhode Island (46th).

The report, written by foundation economist Mark Robyn, notes that property taxes are especially significant for businesses.

"Property taxes matter to businesses because the tax rate on commercial property is often higher than the tax on comparable residential property," Robyn states. "Additionally, many localities and states often levy taxes on the personal property or equipment owned by a business. They can be on assets ranging from cars to machinery and equipment to office furniture and fixtures, but are separate from real property taxes which are taxes on land and buildings."

Businesses paid $619 billion in state and local taxes in fiscal year 2010. Of that, 40 percent, or $250 billion, was for property taxes alone, the report states.

Robyn adds that states competing for business "would be well served to keep statewide property taxes low so as to be more attractive to business investment."

He also notes that while property taxes and unemployment insurance taxes are levied by every state, several states that do without one or more of the major taxes -- the corporate tax, income tax and sales tax -- fare much better in the rankings.

Wyoming, Nevada and South Dakota, for example, have no corporate or individual income tax, he states, while Alaska has no individual income or state-level sales tax; Florida has no individual income tax, and New Hampshire and Montana have no sales tax.

New Hampshire, ranked sixth, is the highest rated northeastern state, while Montana is ranked eighth. Washington state, ranked seventh, Texas (ninth) and Utah (10th) round out the top 10.

"It is obvious that the absence of a major tax is a dominant factor in vaulting many of these 10 states to the top of the rankings," he states.

"The lesson is simple," he added. "A state that raises sufficient revenue without one of the major taxes will, all things being equal, have an advantage over those states that levy every tax in the state tax collector's arsenal."


TOPICS: Business/Economy; Local News
KEYWORDS:

1 posted on 01/26/2012 5:14:35 AM PST by Graybeard58
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To: Graybeard58

What do they have in common?

Insane public unions that control state government...


2 posted on 01/26/2012 5:34:24 AM PST by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: Graybeard58

Property taxes in Connecticut are set by the towns, not the state.


3 posted on 01/26/2012 5:50:26 AM PST by proxy_user
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