Ind. ranks among top for business tax

Indiana ranked among the 10 best states for taxes on business, according to the Tax Foundation’s State Business Tax Climate Index released Oct. 9.

The Tax Foundation’s State Business Tax Climate Index gathers data on over a hundred tax provisions for each state, according to a press release from the Tax Foundation. Each state’s data is compared against one another, so that each state’s ranking is relative to policies in other states.  Indiana was ranked 10th.

A state’s ranking can experience a significant change based on its actions and on changes made by other states, according to the release.

Liz Irwin, director of advocacy and public policy for the Greater Bloomington Chamber of Commerce, said Indiana has competitive incentive programs and exemptions in place that make Indiana rank so highly.

“When you look at the difference in tax climate in surrounding states, that
difference encourages companies to locate or relocate in Indiana,” Irwin said.

For example, Illinois has a corporate tax rate of 9.5 percent, Irwin said.

Indiana’s current rate is 7.5 percent and will be reduced to 6.5 by July 1, 2015, Irwin said. 

“Businesses here are well aware of those rates,” she said.

Irwin said businesses look at tax rates when determining where they are going to locate.

Dana Palazzo, project manager for the Bloomington Economic Development Corporation, said in an email, attraction of businesses in an area depend on certain site requirements such as available labor force and the strength of education systems.

“Having a fiscally responsible state with a tax system that encourages business development is often at the top of that list,” she said. “A healthy tax and regulatory environment is essential to the success of any business as it invites investment and growth.”

— Alli Friedman