Today’s map shows states’ rankings on the property tax component of the 2019 State Business Tax Climate Index. The Index’s property tax component evaluates state and local taxes on real and personal property, net worth, and asset transfers. The property tax component accounts for 15.4 percent of each state’s overall Index score.
Property taxes matter to businesses for several reasons. To start, tax rates on commercial property are often higher than the rates on comparable residential property. In addition, many states and localities levy taxes not only on the land and buildings a business owns, but also on tangible property, such as machinery, equipment, and office furniture, as well as intangible property, such as trademarks. Across the nation, property taxes represent one of the most substantial state and local tax burdens most businesses face. In fiscal year 2013, taxes on real, personal, and utility property accounted for 36.1 percent of all taxes paid by businesses to state and local governments.
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