Nevada has landed near the top of another list, ranking as the state with the second-most-friendly policy environment for small businesses, according to a recent report from an advocacy group.
The Small Business &Entrepreneurship Council annually ranks the 50 states based on policy measures and costs affecting small businesses. For the second year in a row, Nevada ranked No. 2.
South Dakota topped the list.
“Quite simply, the states are compared and ranked according to how state and local government policies impact costs and incentives for entrepreneurship and investment,” said Raymond Keating, author of the study and chief economist for the Vienna, Va.–based organization.
Keating said such risk-taking “is critical to economic growth, income growth and job creation.”
The rankings consider a variety of tax, regulatory and government spending measures. The 18th annual survey ranked South Dakota, Nevada, Texas, Wyoming and Florida in the top five, while the least-friendly policy environments can be found in Hawaii, New York, Vermont, New Jersey and California.
Karen Kerrigan, SBE Council president and CEO, said Nevada and other top states are streamlining government and lifting burdens such as excessive taxation and regulation. Kerrigan said they are passing responsible budgets and living within their means.
“The worst-ranked states keep treating small businesses and entrepreneurs as piggy banks to fund higher spending and bankrupt programs,” Kerrigan said in a statement.
In October, Nevada landed at No. 3 on the Tax Foundation’s 2014 edition of the State Business Tax Climate Index. A list of the states with the best business climates on Forbes.com also ranked Nevada third.
But in a Forbes poll of Best Places to Do Business, Nevada ranked 46th, as the magazine cited the state’s gross domestic product growth rate of 1.5 percent and high unemployment.
In a summary of its 63-page report, the SBE Council highlighted eight states for policy changes that will improve their competitive nature.
Arizona, one of several competitors to Nevada, was recognized for a “phased-in reduction in corporate income and capital gains tax rates.” The corporate income tax rate will be cut 29.7 percent to 4.9 percent by 2017, while capital gain is eliminated on income derived from investments in small businesses with assets up to $10 million beginning next year.
Nevada has no corporate income or capital gains taxes. Nevada was tied for first when it came to capital gains tax rates, while it was tied with five states that don’t have corporate income taxes.
The Silver State ranked 21st at 2.896 percent when it comes to ranking state and local property taxes as a share of personal income. Nevada was 48th at 5.025 percent, when it came to state and local sales, gross receipts and excise taxes as a share of personal income.
The Small Business &Entrepreneurship Council is a nonprofit, nonpartisan advocacy and research group. The complete “Small Business Policy Index 2013” report can be found at www.sbecouncil.org.
Contact reporter Chris Sieroty at firstname.lastname@example.org or 702-477-3893. Follow @sierotyfeatures on Twitter.
Top 10 entrepreneur-friendly states
1. South Dakota
Source: The Small Business & Entrepreneurship Council