TORONTO – Among a survey of 73 U.S. cities that offer the most favorable tax structures for businesses, Providence ranked 15th overall.
The report, part of a comprehensive study of 55 cities from around the world, was issued by audit, tax and advisory firm KPMG International and was broken down by country and by U.S. cities.
KPMG compiled the ranking using total tax index, a measure used to compare tax burden by comparing the total actual tax cost in U.S. dollars for each jurisdiction.
Providence had an overall total tax index of 85.8, with 100 being the baseline. Cities with lower scores had more favorable tax structures for businesses than cities with higher scores.
Boston ranked No. 35 on the comprehensive list of U.S. cities with a TTI score of 91.9.
Comparatively, Baton Rouge, La., which ranked first on the U.S. cities list, had a TTI of 66.5 and San Francisco, which ranked last, had a TTI of 106.6.
Overall, Providence posted a 25.1 percent corporate income tax rate, a 6.6 percent rate for “other corporate taxes,” a 20.8 percent rate for statutory labor costs and a 52.5 percent total effective tax rate.
Among the U.S. cities, Providence ranked ninth for corporate income tax rate, 13th for its other corporate taxes rate, 59th for its statutory labor costs and 15th for its total effective tax rate.
In the digital sector – which was graded based on an analysis of two model business operations: a software development firm and a videogame production studio – Providence ranked ninth out of the list of U.S. cities with a TTI of 77.2.
In the research and development sector, Providence ranked 58th out of the 73 U.S. cities, with a TTI of 100.8. Hartford closed out that list with a TTI of 106.7.
In the corporate services sector, Providence ranked 56th, with a TTI of 99.2. The results for the corporate services sector were based on an analysis of two model business operations: a professional services operation, such as an international financial services firm, and a support services operation, such as a shared services center.
Rhode Island’s capital city ranked 17th out of the 73 U.S. cities for manufacturing, with a TTI of 84.3.
The analysis was based on cost information collected between July 2011 and January 2012 and taxes in the report reflected tax rates in effect on Jan. 1, 2012.
Among the 14 countries in the study, KPMG ranked the U.S. eighth in terms of favorability of its overall tax structure for business.
PBN is now accepting applications for its newest award program and event for RI & Bristol County to celebrate the Manufacturing Renaissance that is evolving regionally and across the country. The deadline for applications is March 20th.
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.