Nebraska was ranked by the Tax Foundation in a recent study as having the lowest tax burden on new business and the 9th lowest tax burden on existing business. The study, Location Matters, A Comparative Analysis of State Tax Costs on Business, was released last month by the Foundation in a joint effort with KPMG.

We have known that a perceived disadvantage for business growth in Nebraska is the relatively high tax burden compared to many of our regional competitors. That is why the Lincoln Chamber of Commerce and Lincoln Partnership for Economic Development have worked diligently with our state partners to create a better tax climate. We have seen success in recent years with Nebraska Advantage, the largest tax cut package in the state’s history in 2007, the talent and innovation initiatives in last year’s legislative session and other business specific initiatives. One particular bill of which I am proud is the Research and Development tax credit, a Lincoln Chamber of Commerce championed bill in 2005 and one of the most cited business advantages for R&D companies.   Nebraska is one of only two states with a refundable R&D tax credit, which is especially helpful to technology-based startup companies.

The Tax Foundation’s study validates those efforts.

KPMG studied the state and local tax burden on certain business. Nebraska scored 1st for new corporate headquarters and new call centers. In addition, Nebraska placed 2nd in the U.S. in manufacturing and R&D. Lincoln specifically was studied for the manufacturing comparison and also finished in the Top 10 for both capital intensive manufacturing and labor intensive manufacturing for existing or “mature” operations. Nebraska scored well on both new and existing R&D operations thanks to the R&D tax credit which was specifically cited in the study. This is obviously great news as we begin to market Innovation Campus.

We take pride in our city and state’s top rankings.  We enjoy hearing what others say about our community and, through the Partnership, we are engaging in a major campaign to let site selection key decision makers know about the most recent Tax Foundation study. However we should all understand that rankings are a function of the methodology used for the study. The KPMG study still shows we are in the lower half of tax burden on existing corporate headquarters, retail establishments and distribution centers and it does not take into account tax burden on individuals. Even the Tax Foundation itself, when looking at a different set of numbers, ranks Nebraska 30th in overall business climate.

We should always strive to be better. More business means more jobs and a better quality of life for Lincoln residents. The Chamber and the Partnership are dedicated to that mission and will continue to ensure our community is positioned for growth. But in the meantime, don’t forget to share our good news with your friends outside of Lincoln and take pride in the fact that we live in a truly great place.

The Chamber’s mission is to improve the lives of Lincoln residents by providing increased economic opportunity and can only be accomplished together.  Networking opportunities, business advocacy, and creating economic viability are critical to our success.  We encourage you to become a member and help us achieve these goals for Lincoln.

For more information on the Lincoln Chamber of Commerce, please contact Paul at (402) 436-2350 or visit them online at www.lcoc.com/.