Many people are beginning to wrap their minds around the House Republicans’ proposed destination-based cash-flow tax and what it means for tax reform. Most people are still looking into the tax’s impacts on trade and how...
- Monday Map: State Tax Incentives for Business
Monday Map: State Tax Incentives for Business
Today's map looks at three tax credits for businesses: job creation, research and development, and investment. States often use such tax incentives to encourage businesses to move in, though these methods tend to be distortionary and favor certain types of businesses over others. (People are occasionally surprised to learn that our State Business Tax Climate Index penalizes states for having tax incentives. Our view is that it's more efficient and neutral to tax everyone equally - tax incentives are a way to disguise government subsidies as deferred revenue. A better method to encourage businesses to move in is to lower tax rates across the board.)
The map is below. Many states offer all three types of incentives, while two (Alaska and Michigan) offer none.
Click on the map to enlarge it.
Previous Monday Maps are available here.
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