Each year, the Tax Foundation’s State Business Tax Climate Index gauges how the tax systems of states compare to one another. Because taxes affect location decisions, job creation and retention, and competitiveness, the Index is considered a measure of the “tax-friendliness” of each state’s tax system. Here is this year’s map, showing Nevada in 5th place among states:
As a way of drilling down regionally, we thought it would be helpful to delve into and create a table showing (1) the rankings of western states in 2017 and each of the three prior years and (2) which states have seen a net positive or net negative in their rankings during that same time period.
As shown in our table below, Colorado has seen the most improvement, gaining 2 slots (from #18 in 2014 to #16 in 2017). Nevada has seen the biggest decrease, dropping 2 slots (from #3 in 2014 to #5 in 2017).
Nevada’s drop is likely due to the commerce tax (aka a gross receipts tax) passed by the Legislature during the 2015 session.
This next set of numbers shows where the Index ranked each of the western states for the various types of taxes:
For the Tax Foundation’s complete report, click here.