A prototypical new corporate headquarters in Omaha might have an effective tax rate of 1.4 percent while the same one in Philadelphia would be taxed at 30.7 percent, according to a 200-page analysis by the Tax Foundation and KPMG.
In Kansas, a distribution center can be taxed at more than 65 percent, compared to 18.3 percent in Ohio.
The dramatic disparity among states has led to attempts to “poach” companies by governors such as Texas' Rick Perry, who this month used a series of television spots to encourage Maryland companies to relocate there.
“If you want to live free -- free from over-taxation, free from over-litigation, free from over-regulation, a place that's got a great skilled workforce, move to Texas,” Perry said.
But the 2012 study questions whether Perry is in a position to be boasting at all.
For older companies, Maryland ranks favorably at 8th in the nation, compared to 12th for Texas. For the relocating companies Perry hopes to lure, Texas may fare better than Maryland, but hardly has bragging rights.
Texas ranks 42nd for new companies compared to Maryland's 46th. In property taxes, Maryland ranks worst in the nation, but Texas is not much better, at 45th.
Indeed, although the largely conservative interior of the country placed very favorably in terms of tax rates, there were exceptions even there, such as the abysmal showing by Kansas. Plus, Republican-led states were not always markedly better than Democrat-controlled ones.
Vermont, perhaps best known as home of the hippie ice cream company Ben & Jerry's, is 12th-best for new businesses, while South Carolina placed toward the bottom for new and existing businesses.
The tax code is complex, making it easy for politicians to cherry-pick favorable numbers that can easily be cancelled out by other factors.
"Oregon, which does not levy a sales tax, offsets its top ranking for sales taxes with a last-place ranking for unemployment insurance (UI) taxes," the study notes.
That complexity was highlighted this summer at the federal level, where the corporate tax rate of 35 percent can be far different in practice due to sprawling loopholes, and consensus has been growing to do away with many loopholes and establish a simpler tax code with a lower rate.
It's also marred by tax credits that are given out piecemeal, especially in Rust Belt areas like upstate New York, desperate to attract business at any cost.
"I call it the heroin drip of government, is giving out tax credits. And we need to get away from that," Michigan Gov. Rick Snyder, a Republican, said at a recent American Enterprise Institute panel on making states attractive to businesses.
When Snyder eliminated a special tax Michigan imposed on corporations, he also took away some 50 credits, deductions, and exemptions along with it, speakers noted.
Among the states, the worst to start a new business in are Hawaii, Pennsylvania and Kansas. The best are Nebraska, Louisiana and Ohio.
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