Source: Tax Foundation
Virginia continues its long side in tax competitiveness this year with a No. 26 ranking in the Tax Foundation’s “2023 State Business Tax Climate Index.” That’s a decline from 25th place last year, 24th place in 2021, and 23rd place in 2020. As recently as 2017, Virginia’s business tax climate ranked 16th.
After eight years of political dominance by Democrats, Virginia has been transmogrifying slowly into New Jersey, which ranks 50th in the country on business taxes. It’s hardly a surprise that the Old Dominion’s middle-of-the-pack tax policy and dramatic fall-off in worker freedom (from A+ to C, according to the Commonwealth Foundation) has coincided with domestic population out-migration and sub-par economic growth over the decade.
On the other hand, Virginians can console themselves that the Commonwealth ranked No. 1 in Site Selection Magazine’s 2022 Business Climate ranking based on key site-location criteria selected by site-selection executives. Workforce skills was the top criterion, while workforce development resources and… wait, what?… tax climate were tied for the second most important factor.
For what it’s worth, according to the Tax Foundation, the 10 top states for business taxes this year are Wyoming, South Dakota, Alaska, Florida, and Montana. The worst: Maryland, Connecticut, California, New York, and New Jersey.
If you’ve got a No. 26 rank, at least it helps to be located next door to Maryland which takes the No. 45 slot. On the other hand, it hurts being next door to North Carolina in the No. 10 position.
— JAB
