Mark Massel is President & CEO at the Northwest Indiana Forum
As companies look to expand or locate their business, NW Indiana wants them to ask, 'Why Indiana'. We want this question because it allows companies to learn the advantages of this region. We have wonderful amenities with Lake Michigan, a national and a state park, trails, sports, theater, gaming and many other attractions. The housing is great and educational opportunities are superb including 6 colleges and universities in the region. And each of these items is important to a company and their employees.
However, they are also deeply concerned about the costs of doing business. The importance of costs has been really highlighted by Illinois's recent decision to raise both personal and corporate property tax rates. (Contrast this with Indiana's decision to lower corporate tax rates over the next 4 years from 8.5% to 6.5%.)While there have long been huge advantages to locating in Indiana, the outcry from Illinois businesses following the income tax increase has been significant.
And just how significant are those cost differences? Cender & Company recently prepared an analysis which highlights these differences. The entire presentation can be found at www.nwiforum.org. In summary, this analysis showed:
The Total reflects only Corporate Income Taxes since businesses will pay either Corporate or Individual depending on how the business is organized. A business owner will, of course, pay individual income tax on their income. These savings were based on estimates of the costs of a business located in Indiana compared to the identical business located in Illinois. (Note that this analysis has not factored in Indiana's lowering of the corporate income tax rate.) So, the assumptions were, that for corporate income tax, the company had $1,000,000 in net taxable income; for individual income tax, that a person, partnership, S Corporation, LLC or LLP had $1,000,000 of net taxable income; for real estate taxes a $5,000,000 building with abatements allowed by each state; for personal property taxes, $1,000,000 of equipment depreciated for 5 to 8 years with abatement; and for workers compensation and unemployment insurance, 100 employees in the company. And this does not consider some of the incentives which can be offered by a local community or the State of Indiana.