A couple weeks ago we talked about the 5 worst states for running a business. This week we will look at the 5 BEST states for running a business. This seems a little more optimistic. It’s true that our current economic conditions and tax changes certainly favor the business owner at this point. This is good news no matter where you live. However, there are certainly some states that have a bit of an advantage, whether that is due to local economic conditions, state and local taxes, labor pool, cost of living, etc., today we’ll look at several factors and put our own twist on it as we consider these states from a tax, accounting and financial aspect as well.
Here are our top 5 states to run a business.
#5 – Utah
Utah is ranked one of the top 9 states in the country for its tax environment. This means property tax, income, corporate, sales, it is one of the lowest. Because of this, the cost for doing business in Utah according to KSL.com, is more than 5% below the national average. Utah also has an incredible infrastructure built for safety and longevity.
#4 – North Dakota
North Dakota’s economic boom in recent years is no secret. The oil industry has skyrocketed which of course impacts the economy in North Dakota, as a whole, positively. One major thing a booming local economy impacts: financing. When assets are liquid and fluid, lending becomes that much easier. This means putting legs to your “great idea” is a much more attainable reality than in other states.
#3 – Florida
Florida is tricky to call one of the best places to do business in the country. On one hand it is. There is no state income tax which frees up spending. However economic activity is also much more dependent on the season than in other states. Many local economies are driven by tourism; spring break, snow birds, etc. So the climate plays a factor and businesses can go through drastic ups and downs in any given year.
The state as a whole has grown significantly in recent years which is part of the reason for the increased economic activity.
#2- North Carolina
Turns out the home of the Tar Heels is a great place to do business. We love the corporate tax rate. At 3% it is the lowest in the country. The labor pool is relatively untapped and costs of doing business is one of the lowest in the country. Check out North Carolina if you are looking to start a new business. Forbes Magazine actually ranked it as the top state to do business in for 2018 based on a number of factors.
#1 – Texas
With tax incentives for manufacturing equipment and machinery purchases, along with grants to help businesses form partnerships with area colleges, the government really seems to encourage business growth, especially through training, education and individual skills development. Their commitment to developing talent is evident through their education plan which aims at ensuring at least 60% of folks age 25-34 are able to reach their secondary education goals. This is fantastic news for business owners as it makes hiring good talent (often one of the toughest challenges for businesses) that much easier.
The longhorn state is a great state to start and own a business, enough so that it is number one on our list. There is so much opportunity in this massive state.