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New Jersey Is the Worst State In the Nation to Have a Business

New Jersey Is the Worst State In the Nation to Have a Business

According to the 2023 State Business Tax Climate Index, New Jersey is the worst state in the nation to be a business owner.

New Jersey radio station 101.5 reported that Janelle Fritts, a policy tax analyst for the Tax Foundation and co-author of the aforementioned annual report, said the states that typically do poorly in the ranking “are states that have very complex tax codes and states that have very high rates, and New Jersey, of course, has both of those in almost every tax category.”

For example, “it has the highest corporate income tax in the country at 11.5%. Its individual income tax is also very uncompetitive -- you’ve got a 10.75% top rate on that one."

Fritts also cited the "sky high" property tax rates in The Garden State. 

It is worth noting that the state recently revamped its property tax relief program for homeowners and renters -- the former homestead exemption was scrapped in favor of the new ANCHOR program, which aims to provide "property tax relief to New Jersey residents who owned or rented their principal residence (main home) on October 1, 2019, and met the income limits."

Homeowners with incomes of more than $250,000 and renters with incomes of more than $150,000 do not qualify. Furthermore, it is not designed for non-residential properties. 

In regard to New Jersey's low ranking on the State Business Tax Climate Index, Fritts said the silver lining is that the only way is up for the state, and that there are plenty of things officials can do to improve the state's ranking in future years. 

Specifically, she suggested, “doing full expensing for capital investments. That means letting business owners who buy anything in the capital investment area to expense that totally in the first year.”

Fritts also encouraged state authorities to reduce tax rates to be more competitive with other New England states and states around the nation. 

The complete bottom 10 on this year's listing is:

41. Alabama

42. Rhode Island

43. Hawaii

44. Vermont

45. Minnesota

46. Maryland

47. Connecticut

48. California

49. New York

50. New Jersey

What do you think? Is New Jersey a good place to run a business?

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Rebekah Barton

Rebekah Barton

Rebekah's search engine optimization career began completely by accident as a college student. Over the course of her career so far, she has "grown up" with the SEO industry, from writing content while juggling classes to managing her own teams of writers and overseeing SEO strategy in subsequent roles. She is excited to bring her passion for high-quality content to CountingWorks, Inc.

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