Indiana's tax structure is competitive and is intended to reward investments and business innovation. State and local government levels know the significance in providing the populace equitable services and strong transportation networks while upholding a fair and impartial tax structure.
- The Corporate Adusted Gross Income Tax is calculated at a flat 8.5 percent of adjusted gross income. Adjusted gross income is a company's federal adjusted gross income with certain adjustments. This method od determination simplifies tax calculations for corporations and does not apply to S corporations and not-for-profit organizations.
Indiana is also phasing in the Single-Sales Factor for apportioning corporate income tax. Indiana had determined its share of an interstate or international corporation's taxable income by weighing the Indiana portion of a company's property and the proportion of its employees in Indiana. The single-sales factor will calculate the Indiana portion based solely on the portion of a mcompany's sales in Indana. This change is being phased in and will be completed by 2011.
- For Gasoline and Diesel Fuel Tax, the combined ffederal, state and local tax on gasoline in Indiana is $0.501 per gallon. The combined federal state and local tax on diesel fuel in Indiana is $0.692 per gallon.
- Indiana has no Gross Receipts/Inventory Tax.
- Real and Personal Property Tax is assessed at 100 percent of market value. Tax rates and exemptions vary among local jurisdictions. Indiana's 2008 Property Tax Reform Act cut property taxes signifcantly and will provide permanent protection for homewoners and bsuinesses. Beginning in 2010, howowner property taxes were capped at 1 percent of a home's assessed value, apartments and agriculture land were capped at 2 percent of assessed calue, and business property was capped at 3 percent of assesed value.
- Indiana Sales and Use Tax is tax calculated at a rate of 7 percent. In manufacturing used in direct production of product, the following are exempt from the sales tax: raw materials, equipment, electrical energy, natural gas and other utility services. Wholesale items used directly in production and sales made in interstate commerce are exempt. IN addition, the purchases of research and development equipment is exempt from the tax.
The total State Business Taxes - Sum of Corporate State Income Tax,
Workers' Compensation and Unemployment Insurance (2010):
| Indiana | $151,136 |
| Illinois | $250,746 |
| Kentucky | $232,405 |
| Michigan | $168,927 |
| Ohio | $162,303 |
| Iowa | $212,453 |
| Minnesota | $266,135 |
| Wisconsin | $200,932 |
| Missouri | $195,070 |
| Connecticut | $265,152 |
| Massachusetts | $209,297 |
| New Jersey | $317,965 |
| New York | $259,584 |
| North Carolina | $186,928 |
| Pennsylvania | $248,441 |
| South Carolina | $173,130 |
| Virginia | $147,715 |
Source: State of Indiana Midwestern States-Cost of Doing Business Comparison, August 2010; other major Sources are: U.S. Census Bureau of Labor Statistics; U.S. Department of Labor; Bureau of Economic Analysis
Average Workers' Compensation Rate (2008):
| Indiana |
$1.23
|
| Illinois |
$2.79
|
| Kentucky |
$2.96 |
| Michigan |
$2.15
|
| Ohio |
$3.32
|
| Iowa |
$1.86
|
| Minnesota |
$2.33
|
| Wisconsin |
$2.12
|
| Missouri |
$2.20
|
| Connecticut |
$2.46
|
| Massachusetts |
$1.39
|
| New Jersey |
$2.66
|
| New York |
$2.55
|
| North Carolina |
$2.43
|
| Pennsylvania |
$2.68
|
| South Carolina |
$2.74
|
| Virginia |
$1.43
|
Source: State of Indiana Midwestern States-Cost of Doing Business Comparison, August 2010; other major Sources are: U.S. Census Bureau of Labor Statistics; U.S. Department of Labor; Bureau of Economic Analysis
The average Unemployment Insurance Based on 100 Employees (2010):
|
Indiana
|
$18,900
|
|
Illinois
|
$41,820
|
|
Kentucky
|
$21,600
|
|
Michigan
|
$24,300
|
|
Ohio
|
$24,300
|
|
Iowa
|
$23,700
|
|
Minnesota
|
$61,360
|
|
Wisconsin
|
$39,000
|
|
Missouri
|
$43,875
|
|
Connecticut
|
$46,500
|
|
Massachusetts
|
$35,420
|
|
New Jersey
|
$80,920
|
|
New York
|
$34,850
|
|
North Carolina
|
$21,360
|
|
Pennsylvania
|
$29,600
|
|
South Carolina
|
$23,800
|
|
Virginia
|
$20,160
|
Source: State of Indiana Midwestern States-Cost of Doing Business Comparison, August 2010; other major Sources are: U.S. Census Bureau of Labor Statistics; U.S. Department of Labor; Bureau of Economic Analysis
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