Arizona finished 17th in a study by the Tax Foundation examining which states have the most business-friendly corporate income tax structures.
The state’s ranking dropped two positions from its 2018 score, according to the foundation’s analysis, which is part of a wider study titled “2019 State Business Tax Climate Index.”
The corporate tax ranking measures each state’s primary levy on business activities. Some states take a cut of businesses’ gross receipts, which the Tax Foundation sees as more economically harmful, while the majority of states tax corporate profits – the amount in receipts after most business expenses are deducted.
The analysis also looked at how corporate tax systems deal with net operating losses, whether machinery and equipment purchases can be deducted and whether corporate income tax brackets are indexed for inflation.
The highest-scoring states in the analysis were South Dakota, Wyoming, North Carolina and Missouri.
---
How Do States Measure Up on Corporate Taxes?
| State | 2018 Rank | 2019 Rank | Change from 2018 to 2019 |
| South Dakota | 1 | 1 | 0 |
| Wyoming | 1 | 1 | 0 |
| North Carolina | 3 | 3 | 0 |
| Missouri | 5 | 4 | 1 |
| Utah | 4 | 5 | -1 |
| Florida | 19 | 6 | 13 |
| New York | 6 | 7 | -1 |
| Georgia | 7 | 8 | -1 |
| Oklahoma | 9 | 9 | 0 |
| Virginia | 7 | 10 | -3 |
| Michigan | 10 | 11 | -1 |
| Montana | 11 | 12 | -1 |
| West Virginia | 23 | 13 | 10 |
| Hawaii | 14 | 14 | 0 |
| Mississippi | 12 | 15 | -3 |
| Colorado | 13 | 16 | -3 |
| Arizona | 15 | 17 | -2 |
| Indiana | 24 | 18 | 6 |
| South Carolina | 16 | 19 | -3 |
| Alabama | 18 | 20 | -2 |
| New Mexico | 20 | 21 | -1 |
| Maryland | 21 | 22 | -1 |
| North Dakota | 17 | 23 | -6 |
| Tennessee | 22 | 24 | -2 |
| Alaska | 26 | 25 | 1 |
| Idaho | 25 | 26 | -1 |
| Kentucky | 28 | 27 | 1 |
| Nebraska | 27 | 28 | -1 |
| Connecticut | 33 | 29 | 4 |
| Oregon | 29 | 30 | -1 |
| California | 31 | 31 | 0 |
| Rhode Island | 32 | 32 | 0 |
| Nevada | 37 | 33 | 4 |
| Kansas | 35 | 34 | 1 |
| Wisconsin | 30 | 35 | -5 |
| Louisiana | 36 | 36 | 0 |
| Massachusetts | 38 | 37 | 1 |
| Vermont | 40 | 38 | 2 |
| Illinois | 34 | 39 | -5 |
| Arkansas | 41 | 40 | 1 |
| Maine | 39 | 41 | -2 |
| Minnesota | 43 | 42 | 1 |
| Pennsylvania | 44 | 43 | 1 |
| Washington | 45 | 44 | 1 |
| New Hampshire | 46 | 45 | 1 |
| Ohio | 47 | 46 | 1 |
| New Jersey | 42 | 47 | -5 |
| Iowa | 48 | 48 | 0 |
| Texas | 49 | 49 | 0 |
| Delaware | 50 | 50 | 0 |