Indiana ranks 19th in the US for tax environments, according to a small business study

Indiana – According to research, Indiana’s tax climate isn’t the best for small businesses, but it is better than that of most other states.

SimplifyLLC, a company that creates manuals to assist individuals in starting and running small businesses, examined data for all 50 states and the District of Columbia. The Hoosier State came in at number 19 overall.

In order to evaluate the states, the study looked at five important taxes: corporate, personal income, sales, property, and unemployment.

Nevada, South Dakota, Washington, Wyoming, and Texas, the top five states according to SimplifyLLC’s rankings, do not have corporation or personal income taxes.

The paper showed that, “Our analysis found that states with no or low personal and corporate income taxes are the most tax-friendly for small businesses, even when they have higher taxes for property, sales, and unemployment compared with other states,”

The General Assembly passed a budget this year that will further reduce Indiana’s low, flat income tax rate, which is currently 3.15 percent, until it hits 2.9 percent in 2027.

The corporation tax rate in the state is 4.9%, which is less than half of what it was in 2012. Indiana had the eighth-lowest corporate income tax in the nation among states that imposed one, according to the Tax Foundation. Corporate income is not taxable in six states.

With Tennessee, Rhode Island, and Mississippi, Indiana is tied for the second-highest state in terms of sales tax at 7%. However, Indiana, which does not permit local sales taxes, drops to 24th nationwide when local option sales taxes are taken into account.

In terms of property taxes, Indiana is similarly in the center of the pack.

Only Ohio finished with a higher ranking among Indiana’s neighbors. In the study, it came in seventh place. Illinois placed 42nd, Kentucky 26th, Michigan 29th, and Michigan was in the lowest 10 finishers.

SimplifyLLC notes that while Nevada topped the rankings, New Jersey came in last due to a combination of high property, sales, corporate, and income tax rates in the Garden State.