By LARMIE SANYON
Indiana has the best business tax climate in the Midwest and ninth best overall in the nation. That’s according to a Tax Foundation report released last week.
The foundation uses five rankings categories: income, sales and corporate taxes, property tax and the unemployment insurance tax.
Indiana Business Research Center Director Jerry Conover says he was not surprised by the positive ranking because Indiana legislators have been very deliberate in creating the state’s tax climate.
“It’s a delicate balancing act to find the right level of taxes where enough people will be living and working here to keep the state going with revenue while at the same time not so high that it scares away people who decide they are going to live somewhere else,” he says.
Conover says the reasons for higher taxes in other states vary but Indiana policies remain consistent.
He says Indiana’s tax climate has spurred growth in new industries like information technologies. And he says affordable corporate tax rates and low cost of living for employees makes the Hoosier state attractive.
While some advocate for further cuts, Conover warns legislatures should be careful because taxes fund health insurance, public schools and infrastructure projects.
He also recommends avoiding significant tax increases.
“A key way that state government can do that, and for that matter even local governments, is to not impose more taxes than necessary to support basic public needs,” Conover says.
Indiana dropped one spot in the ranking, from eighth to ninth nationally, since last year.