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WASHINGTON DC — Pennsylvania has the 24th most competitive tax code in the nation according to the 13th annual State Business Tax Climate Index, released today by the nonpartisan Tax Foundation.
The report measures how well-structured each state’s tax code is by analyzing over 100 tax variables in five different tax categories — corporate, individual income, sales, property, and unemployment insurance.
The breakdown of Pennsylvania’s rankings this year is as follows (1st is best, 50th is worst):
• Overall tax climate: #24
• Corporate tax structure: #44
• Individual income tax structure: #17
• Sales tax structure: #20
• Property tax structure: #32
• Unemployment insurance tax structure: #45
States are penalized for overly complex, burdensome, and economically harmful tax codes and rewarded for transparent and neutral tax codes that do not distort business decisions. A state’s ranking can rise or fall significantly not only because of its own actions, but also because of reforms made in other states.
“Our goal with the State Business Tax Climate Index is to start a conversation between taxpayers and policymakers about how their states fare against the rest of the country,” said Jared Walczak, an analyst for Tax Foundation, in a news release. “While there are many ways to show how much a state collects in taxes, the Index is designed to show how well states structure their tax systems, and to provide a road map for improvement.”