The Council on State Taxation (COST) today released its annual report on state and local business taxes. The report was prepared for COST by Ernst & Young LLC (E&Y) using data for fiscal year 2012.

E&Y calculates that in FY 2012 the ratio of state and local taxes paid by businesses in Washington to private sector value added was 5.3 percent. Washington ties with Kansas for 14th highest among the states in this ratio, which E&Y terms the total effective business tax rate (TEBTR). The nationwide average TEBTR was 4.8 percent.

Taxes paid by businesses were 53.9 of percent total state and local taxes in Washington for FY 2012. Washington ranked 9th highest among the states in the share of state and local taxes paid by businesses. The nationwide average business share of state and local taxes was 45.2 percent.

Five states got more than 50 percent of state and local taxes from businesses: Alaska (89.7 percent), North Dakota (73.5 percent), Wyoming (73.2 percent), Texas (61.5 percent) and Louisiana (60.7 percent). Each of these states raises a good deal of revenue from severance taxes on petroleum production.

The COST study can be downloaded here.