Category Archives: Tax

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2018’s New Corporate Income Tax For Different States

A total of 44 states have a levy when it comes to corporate income tax. Majority of businesses think that corporate income tax is a major type of tax but the fact is that it is just around 5 per cent of the total taxes collected by the state and it only accounts for 2.6 per cent of the general revenue of an entire state. This is why new businesses in North Carolina are advised to obtain a NC Tax ID and the same is true for other states.

The state with the highest levy when it comes to corporate tax rate is Iowa which is set at 12 per cent. Pennsylvania took the second spot at 9.99 per cent while Minnesota is on the third spot at 9.8 per cent. Aside from these states, three others have a levy rate that is higher than 9 per cent namely New Jersey, Illinois and Alaska.

At the other end of the spectrum, the state with the lowest levy for corporate income tax is North Carolina at only 3 per cent. The second is North Dakota at 4.31 per cent while 4.63 per cent is imposed by Colorado. Aside from those three, there are four states with a levy below 5 per cent including Arizona, Mississippi, Utah and South Carolina.

There are no corporate income taxes in states of Washington, Texas, Nevada and Ohio but businesses are required to pay the taxes for gross receipt. Many view this tax as harmful to the economy because of risk of not being transparent with transactions and possibility of tax pyramiding. On the other hand, the states of Virginia and Delaware have both corporate income tax as well as gross receipts tax. The only two states that do not impose a levy on either tax are Wyoming and South Dakota.

Single rate systems for corporate tax are imposed by 27 states along with the District of Columbia.

There are many changes in the tax system for 2018 but all businesses and entities in North Carolina are urged to obtain a NC Tax ID in order for their business to operate legally.

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Florida To Experience Friendly Tax Climate

The Tax Foundation’s State Business Tax Climate Index report recently got released, and it’s got some good news for Florida lawmakers and those with a FL Tax ID, as the state manages to rank in the highest spots once again.

The Tax Foundation ranks all 50 states’ tax structures based on 100 variables, comparing how each respective state’s tax policies affect the businesses, families and individual taxpayers. The ranking is then revealed in the yearly report, which is released at October annually.

This year, Florida was ranked as #4, having the fourth-best state tax structure in the US, even taking account levies on corporations, sales, unemployment insurance, property and individual income.

Tax Foundation Media Relations Manager, John Buhl elaborates, saying that Florida’s tax structure is reliant on sales tax revenues, more than the other states, as a result of having no income tax. Buhl says that the state’s sales tax structure ranks 29th, but it ranks quite well on property taxes as well as unemployment insurance taxes.

Florida League of Cities Senior Legislative Advocate, Amber Hughes, says that the state of Florida has well-designed taxes, which benefits people with a FL Tax ID, with the state consistently ranking within the top five of the Tax Foundation’s ranking, with other studies ranking the state just as high.

Hughes also says that the fact that Florida doesn’t have personal income taxes means that Florida is attractive to business owners who are hoping to escape the more unfriendly states. He adds that Florida’s high ranking is due to personal income tax, which the state of Florida does not have, is a big factor.

Florida’s taxpayer-friendly climates means that it attracts business owners looking to move, as well as incentivizing entrepreneurs to expand their range of operations, according to Hughes. This not only creates new job opportunities, but also creates nice communities as well as strengthening the economy, which he believes is what most Florida taxpayers want.

Florida’s state taxes are linked to personal income growth, which Hughes elaborates upon, saying that this means that the burden of the state’s taxes don’t rise too fast, certainly not faster than a resident or a business’ ability to pay for it on time.