We're out with a new policy brief on business taxation, "Washington State Businesses Pay 58 Percent of State and Local Taxes." It gives an overview of how and how much Washington businesses are taxed, and compares us to the rest of the country.
Here are some highlights:
- The percentage of Washington’s private sector gross state product paid in business taxes was 5.5 percent; in 40 other states the percentage paid in taxes was lower.
- State businesses paid an average of $7,600 per employee in taxes; in 45 other states, businesses paid less per employee.
- Washington businesses pay almost 58 percent of all state and local taxes.
- Washington had the eighth highest growth rate of business tax revenues, 4.5 percent, from fiscal year 2014 to fiscal year 2015.
- The Tax Foundation says Washington has the 17th best tax climate for business.
- For tax burden comparisons across states, the Tax Foundation classifies B&O taxes paid by sole proprietors, S corporations and other pass-through entities as personal income taxes and B&O taxes paid by C corporations as corporate income taxes.
- The Tax Foundation rates Washington state sixth best for personal income taxes, 48th for corporate income taxes, 49th for sales taxes, 27th for property taxes, and 18th for unemployment insurance taxes.
- Changing tax rates is one of the quickest ways for government to affect the business climate.
- States are in competition with each other for economic growth: tax policy is a key weapon states deploy in this competition.
Click here to read the entire policy brief.