Ranking Individual Income Taxes on the 2022 State Business Tax Climate Index
by Janelle Cammenga, Tax Foundation, March 15, 2022
This week’s map examines states’ rankings on the individual income tax component of our 2022 State Business Tax Climate Index. The individual income tax is important to businesses because states tax sole proprietorships, partnerships, and in most cases limited liability companies (LLCs) and S corporations under the individual income tax code. However, even traditional C corporations are indirectly impacted by the individual income tax, as this tax influences the location decisions of individuals, potentially impacting the state’s labor supply, and higher individual income taxes increase the price of labor. States with gross receipts taxes also extend those to pass-through businesses in addition to C corporations, and this is also accounted for in this component of the Index….
The poorest-performing states on this year’s individual income tax component are New York, California, New Jersey, Connecticut, and Hawaii….
read … Full Report