If you are a business owner looking to branch out and explore new markets within the U.S., you have a lot of options to choose from. Some states offer better business opportunities than others. Whether you are starting a new business, growing a small business, or thinking of moving to a new state, the place where you do business will help determine your level of success.
1 Top 10 U.S. States for business
What are the best states in America for business?
The survey America’s Top States for Business in 2019, conducted by CNBC, offers an answer to this question. Informed by a panel of business leaders, policy experts, and government sources, the survey evaluates the business competitiveness of all 50 U.S. states across 10 key categories: workforce, economy, infrastructure, cost of doing business, quality of life, education, technology and innovation, business friendliness, access to capital, and cost of living.
According to the survey, Virginia stands at the top of the rankings, with the most skilled workforce and most educated population. North Carolina, which ranks third, rates as the state with the best overall economy. Washington, which ranks fifth overall and second in the technology and innovation category, currently has the fastest-growing economy of any state.
The Top 10 best States for business:
- North Carolina
2 The best States to start a business
What is the best place to start a business? A state that offers favorable conditions for new businesses—such as access to funding, a skilled workforce and affordable real estate—can help a start-up succeed right from the start.
The 2019 Best and Worst States to Start a Business, a study published by WalletHub, ranks states based on the best conditions for starting a business. The study compares all 50 states across three main categories:
- Overall business environment (the variety of economic conditions impacting start-ups),
- Access to resources (availability of financing, investment funds and skilled workforce),
- Business costs (real estate and labor costs, taxes, cost of living).
According to the study, Texas emerged as the top state overall and the top state in the business environment category. Utah, the runner-up in the overall ranking, also ranked second in the access to resources category. Oklahoma had the lowest business costs of any state.
The best states to start a business:
- North Dakota
3 The best States for small businesses
One of the most important decisions a small business owner can make is choosing where to set up operations. Location is one of the key factors in the potential success of any business.
The 2019 Small Business Friendliness Survey, conducted by Thumbtack, ranks the best states for small business based on factors such as licensing requirements, tax and labor regulations, and the ease of finding workers. The survey polled more than 5,000 small business owners across the country to learn what it takes to operate a small business in their home states.
According to the poll, the three most important things state policymakers can do to help small business owners are:
1) lower taxes; 2) improve access to healthcare and insurance benefits; 3) provide more affordable housing.
The friendliest states for small business:
4 The best States for business tax
Where will your business pay the least tax? This is an important question to answer for any business owner.
The 2019 State Business Tax Climate Index, a study put out by the nonpartisan research group Tax Foundation, offers a comprehensive evaluation of state tax systems. Index ratings take into account individual income taxes, major business taxes, sales taxes, unemployment insurance taxes, and taxes on wealth and assets.
The common factor among the top rated states is the lack of one or more major taxes: corporate income tax, individual income tax, or sales tax. For example, Wyoming, Nevada, and South Dakota have no corporate income tax or individual income tax; Alaska has no individual income tax or sales tax; Florida has no individual income tax; New Hampshire, Montana, and Oregon have no sales tax.
The most tax-friendly states for business:
- South Dakota
- New Hampshire
If you are seeking to grow your business within the United States, you may want to look first at the southern and western regions of the country. Four out of the top five states for small business are located in the south (Arkansas, Virginia, Mississippi, Georgia), as well as two of the top three states overall (Virginia, North Carolina). Western states such as Texas and Utah have robust economies and offer the most favorable conditions for new businesses. In addition, western states dominate the list of America’s most tax-friendly places for business (7 of the top 10).