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2018 Top States for Doing Business Commentary: Southern States Continue Their Domination

Favorable business tax climates and competitive labor environments — as well as aggressive utility economic development programs — have helped the Southern States to come out on top.

Q3 2018
The 2018 Top States for Doing Business continue to be dominated by Southern States with Georgia topping the list for the fifth year, and Texas, Tennessee, and South Carolina remaining in the top five. Alabama moved into the top five, edging out Louisiana, which remained in the top 10. From 2017 to 2018 the top 10 only changed slightly, with Florida moving from 12th to 10th place and edging Ohio out of the top 10.

One observation is that the majority of the top states have aggressive utility economic development programs, such as TVA, FPL, the SC Power Team, and Georgia Power. This is important as these states have resources other than the state and local EDO that can provide additional funding and assistance with site development, incentives, and other programs.

Another observation is that three of the top 10 states — Texas, Tennessee, and Florida — have no personal income tax. With that said, based on the survey results, the following states rank in the top five for corporate tax environment: Texas (1), Tennessee (2), Florida (2), Georgia (4), and North Carolina tied with Nevada and South Dakota for fifth place. These results are somewhat in line with the Tax Foundation’s 2018 State Business Tax Climate Index ranking of corporate taxes1 as follows: South Dakota (1); North Carolina (3); Georgia (10); Florida (19); and Tennessee (21). Texas is surprisingly ranked 49th for corporate taxes by the Tax Foundation, but its overall ranking in the Tax Foundation’s 2018 State Business Tax Climate2 is 13th. Other than Texas, the best overall ranking on the Index is South Dakota (2), Florida (4), North Carolina (11), and Tennessee (14).

The majority of the Southern States also rank high related to competitive labor environment, workforce development programs, shovel-ready sites, incentives and economic development policies, indicating they will probably be seen again next year.

TOP STATES FOR DOING BUSINESS 2018

  1. 1.Georgia
  2. 2.Texas
  3. 3.Alabama
  4. 4.Tennessee
  5. 5.South Carolina
  6. 6.North Carolina
  7. 7.Louisiana
  8. 8.Mississippi
  9. 9.Indiana
  10. 10.Florida
  11. 11.Ohio
  12. 12.Arizona
  13. 13.tKentucky
  14. 13.tVirginia
  15. 15.Arkansas
  16. 16.Oklahoma
  17. 17.Utah
  18. 18.tMichigan
  19. 18.tNew York
  20. 20.Nevada

Individual Categories

Overall Cost of Doing Business

  1. 1.Texas
  2. 2.Tennessee
  3. 3.tGeorgia
  4. 3.tAlabama
  5. 5.tSouth Carolina
  6. 5.tMississippi
  7. 5.tIndiana
  8. 8.North Carolina
  9. 9.tLouisiana
  10. 9.tFlorida
  11. Other: KY

Corporate Tax Environment

  1. 1.Texas
  2. 2.tTennessee
  3. 2.tFlorida
  4. 4.Georgia
  5. 5.tNorth Carolina
  6. 5.tNevada
  7. 5.tSouth Dakota
  8. 8.South Carolina
  9. 9.tVirginia
  10. 9.tUtah
  11. Others: AL, IN, AZ, LA

Business Incentives Programs

  1. 1.South Carolina
  2. 2.tGeorgia
  3. 2.tAlabama
  4. 4.Mississippi
  5. 5.Texas
  6. 6.tTennessee
  7. 6.tLouisiana
  8. 8.Oklahoma
  9. 9.tIndiana
  10. 9.tOhio
  11. 9.tNew York
  12. 9.tNew Jersey
  13. Others: VA, KY

Access to Capital & Project Funding

  1. 1.California
  2. 2.tTexas
  3. 2.tNew York
  4. 4.North Carolina
  5. 5.tGeorgia
  6. 5.tMassachusetts
  7. 7.Florida
  8. 8.tTennessee
  9. 8.tIllinois
  10. 10.Louisiana
  11. Others: CO, NJ, MI, PA, CT, MD

Competitive Labor Environment

  1. 1.Texas
  2. 2.tGeorgia
  3. 2.tNorth Carolina
  4. 4.Florida
  5. 5.Tennessee
  6. 6.tAlabama
  7. 6.tIndiana
  8. 6.tArizona
  9. 9.tUtah
  10. 9.tOhio
  11. Others: SC, MS

Leading Workforce Development Programs

  1. 1.Georgia
  2. 2.Alabama
  3. 3.Louisiana
  4. 4.tSouth Carolina
  5. 4.tTennessee
  6. 6.North Carolina
  7. 7.tVirginia
  8. 7.tOhio
  9. 9.Florida
  10. 10.tMississippi
  11. 10.tIowa
  12. 10.tCalifornia

Shovel-Ready Sites Program

  1. 1.Tennessee
  2. 2.Georgia
  3. 3.Alabama
  4. 4.South Carolina
  5. 5.North Carolina
  6. 6.Ohio
  7. 7.Texas
  8. 8.tIndiana
  9. 8.tMississippi
  10. 10.tKentucky
  11. 10.tLouisiana
  12. Others: AR, VA, IA, WI

Cooperative & Responsive State Government

  1. 1.Georgia
  2. 2.South Carolina
  3. 3.North Carolina
  4. 4.Alabama
  5. 5.Tennessee
  6. 6.tMississippi
  7. 6.tLouisiana
  8. 8.Arizona
  9. 9.tIndiana
  10. 9.tVirginia
  11. Others: OH, TX, AR

Favorable General Regulatory Environment

  1. 1.tAlabama
  2. 1.tGeorgia
  3. 3.Texas
  4. 4.South Carolina
  5. 5.Tennessee
  6. 6.Louisiana
  7. 7.Mississippi
  8. 8.Florida
  9. Others: NC, IN, AR, KY, UT, KS, NV

Favorable Utility Rates

  1. 1.Alabama
  2. 2.Georgia
  3. 3.tIndiana
  4. 3.tOhio
  5. 3.tMichigan
  6. 6.tKentucky
  7. 6.tNorth Carolina
  8. 8.Tennessee
  9. 9.tSouth Carolina
  10. 9.tArizona
  11. 9.tVirginia
  12. Others: AK, ID, CO

Most Improved Economic Development Policies

  1. 1.Alabama
  2. 2.Georgia
  3. 3.Texas
  4. 4.tSouth Carolina
  5. 4.tMississippi
  6. 6.Tennessee
  7. 7.tLouisiana
  8. 7.tIndiana
  9. 9.Arizona
  10. 10.Kentucky
  11. Others: FL, OH, AR
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