Report: Massachusetts Not Business Friendly for Entrepreneurs
Monday, April 23, 2012
The SBE’s 2012 Business Tax Index ranks the 50 states and District of Columbia according to the costs of their tax systems for entrepreneurship and small business. In 2012, Massachusetts took the 35th spot on the list, falling behind New Hampshire at number 25 but staying above its New England counterparts Maine, Rhode Island, Vermont and Connecticut.
“We have the brain power, but the tax rates have always been somewhat business-unfriendly,” says Dick Kennedy, president of the Worcester Regional Chamber of Commerce. “I think Worcester is attempting to do a better job, but in the area of taxes, there’s a long ways to go to be considered user-friendly to new businesses.”
The 18 measures that make up the Business Tax Index include a state’s top personal income tax rate, top individual capital gains tax rate, any added income tax on S-Corporations, gas taxes and wireless taxes, among several others.
Raymond J. Keating, chief economist for SBE Council and author of the report, said: “While ‘Tax Day’ 2012 is officially April 17, it is critical to understand that federal, state and local taxes are a burden on entrepreneurs, investors and the economy throughout the year.”
Keating added: “All taxes matter, whether imposed at the federal, state or local level of government. They matter to consumers, entrepreneurs, investors and businesses. State and local levies matter in terms of a state’s competitiveness. And they matter when it comes to economic growth and job creation.”
In Massachusetts, the Executive Office of Housing and Economic Development responded to the report with the following statement:
“The Patrick-Murray Administration has made growing the Massachusetts economy and creating jobs through supporting small businesses and entrepreneurs a top priority. Massachusetts has world class education, health care, and institutions for higher education and continues to be an international hub for innovation and life sciences and is home to the world’s largest global start-up competition and accelerator program in MassChallenge,” said Jason Lefferts, spokesman for the Executive Office of Housing and Economic Development.
Lefferts continued, noting that “Recently, the Administration announced first of its kind regulation reform to reduce extra burdens on small businesses and entrepreneurs, helping them continue to thrive and create jobs here in the Commonwealth.”
According to the Index, the 15 best tax systems are: 1) South Dakota, 2) Texas, 3) Nevada, 4) Wyoming, 5) Washington, 6) Florida, 7) Alaska, 8) Alabama, 9) Ohio, 10) Colorado, 11) Mississippi, 12) Michigan, 13) South Carolina, 14) Tennessee, and 15) Missouri.
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