WASHINGTON VS. NEVADA BUSINESS COST COMPARISON
Business costs and taxes will vary based on specific locations.
Taxes
State Corporate
Income Tax1
Personal Income
Tax2
Payroll Tax3
Washington
No
Nevada
Nevada's 2013 Business Tax Climate
Ranks 3rd
No
The Index compares the states in five areas of
No
No
No
0% - 1.17%
*1.0% of True & Fair
Value ($10 per $1000)
^Personal – See # 4
*3.13% of Assessed
Value (AV)
^Personal – See # 4
Franchise Tax
No
No
Utah (10 ), Arizona (25 ), Washington (6 ),
Capital Gains Tax6
No
No
Colorado (18 ), New Mexico (38 ) and Texas
Property Tax –
*Real & ^Personal4
5
taxation that impact business: corporate taxes,
individual income taxes, sales taxes,
unemployment insurance taxes, and property
taxes. Neighboring states ranked as follows:
th
California (48th), Oregon (13th), Idaho (20 ),
th
th
th
th
th
th
Unemployment Ins
Tax7
Gross Receipts Tax8
(Business & Occupation Tax)
Business Costs
Monthly Lease Rates9
10
Monthly Payroll Tax
Monthly Property Tax11
12
Monthly Utility Costs
(9 )
.14% - 5.84%
.25% - 5.4%
.00138% - .0330%
No
Source: Tax Foundation
http://taxfoundation.org/article/2013-state-business-tax-climate-index-results
- 250K sf Industrial
Washington
$110,000 (Spokane)
Nevada
$75,000 (Reno)
- $400K Annual Payroll
No
$59
- $25M TFV/AV
$20,833
$22,969
- 400K kwh per month
$32,993 Avista (Spokane)
$32,825 NV Energy (Reno)
Workman’s Compensation Costs
Description
Washington Rate
Nevada Rate – *See note below
Veneer Products Mfg
$1.69 (**Class 2904)
$2.84 (Class 2915 - NCCI)
Machine Shop NOC
$1.22 (**Class 3402)
$2.73 (Class 3632 - NCCI)
Store: Retail NOC
$0.36 (**Class 6406)
$1.31 (Class 8017 - NCCI)
Clerical NOC
$0.14 (**Class 4904)
$0.32 (Class 8810 – NCCI)
NOC = Not Otherwise Classified
Washington Source: Washington State Dept of Labor & Industries – 2014 Hourly Base Rates by Business Type & Class
Codes http://www.lni.wa.gov/ClaimsIns/Insurance/RatesRisk/Check/RatesHistory/
**Washington uses their own Rating Bureau, not NCCI.
Nevada Source: National Council on Compensation Insurance (NCCI) – www.ncci.com – Rates effective 1/1/14
The rates listed for each state are calculated voluntary manual rates and may include loss cost multipliers and assessments.
*Note: Nevada also has a payroll cap: $36,000 of reportable payroll per employee, per employer, per year. However, no adjustment
was made to Nevada's rates to compensate for its payroll limitation on workers' compensation premium.
http://www.insurancejournal.com/news/west/2009/02/13/97880.htm
WASHINGTON VS. NEVADA BUSINESS COST COMPARISON (con’t)
1.
2.
3.
4.
5.
6.
7.
8.
State Corporate Income Tax - Source: Federation of Tax Administration http://www.taxadmin.org/fta/rate/tax_stru.html
Personal Income Tax: Affects businesses significantly because roughly 90% of businesses file taxes as individuals
(e.g. sole proprietorships and partnerships). Sources: U.S. Small Business Administration Office; Federation of Tax
Administrators 2013 http://www.taxadmin.org/fta/rate/ind_inc.pdf Nevada has no personal income tax.
Nevada’s Payroll Tax: If the sum of all taxable wages, after health care deductions, paid by the employer doesn’t exceed
$85,000 for the calendar quarter, there is no tax on those wages. If the sum of all wages exceeds $85,000, the tax is 1.17% of the
amount the wage exceeds $85,000. Source: State of Nevada Legislation - Effective July 1, 2013, SB475 - See # 10 below
Washington Business Real Property Tax Rate: Average 1.0% of true and fair market value (same as $10 per $1000)
Source: 2012 Legislative Guide to Washington State Property
Taxes http://www.leg.wa.gov/Senate/Committees/WM/Documents/Publications/BudgetGuides/2012/2012FinalCombined
TaxGuide.pdf – see page 9 of this document
Washington Business Personal Property Tax Rate: The county assessor values the property at 100% of its current
market value. Market, or true and fair value, is the amount that a willing and unobligated buyer will pay a willing and
unobligated seller. Source: Dept of Revenue Washington
State http://dor.wa.gov/Content/FindTaxesAndRates/PropertyTax/prop_BusPropertyValue.aspx
Nevada Business Real Property Tax Rate: Average 3.13% of assessed value. (*Assessed value is equal to 35% of the
taxable value, which is new replacement cost, less depreciation) *No distinction between personal & business property
tax See #11 below for examples.
Nevada Business Personal Property Tax Rate: $3.66 per $100 of assessed value.
Source: Nevada Taxpayers Association http://www.nevadataxpayers.org/pdf/property-tax-2011-12.pdf
The corporate franchise tax is a tax on the privilege or right to do business in a state based on net income.
Nevada has no franchise tax.
Capital Gains Tax: Source: Tax Foundation http://taxfoundation.org/article/high-burden-state-and-federal-capital-gainstaxes Nevada has no capital gains tax.
Unemployment Insurance Tax: Coverage, taxes and significant provisions of State Unemployment Insurance Laws
Source: Tax Policy Center http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=541
Gross Receipts Tax: Called a “Business & Occupation” tax in Washington, it’s based on gross receipts. This means
there are no deductions from the B&O tax for labor, materials, taxes, or other costs of doing business. There are
several classifications for businesses, each with their own rate. Some businesses can be classified under more than one
rate.
Washington Sources: Washington State Department of
Revenue http://dor.wa.gov/Content/FindTaxesAndRates/BAndOTax/BandOrates.aspx;
http://dor.wa.gov/content/FindTaxesAndRates/BAndOTax/
9.
10.
11.
12.
Nevada has no gross receipts tax.
Based on standard industrial rates for Reno/Sparks, Nevada ($0.30 avg per square foot per month) and Spokane,
Washington ($0.44 avg per square foot per month) for 250,000 square feet of industrial warehouse space.
nd
Nevada Source: Voit Real Estate Services 2 Qtr 2013 www.voitco.com
Washington Source: Greater Spokane Incorporated http://www.greaterspokane.org/real-estate/98-industrial-parks.html
*Taxes, Insurance and maintenance charges are not included in the rates.
Nevada’s Payroll Tax Example: This is assuming $100,000 in wages per quarter – 1.17% (.0117) x $15,000, the
amount exceeding $85,000 = $175.50 ÷ 3 = $59 per month. - See # 3 for formula.
Washington Business Real Property Tax Example: Assuming true and fair market value (assessed value) of
$25,000,000 x .01 = $250,000 ÷ 12 = $20,833 property tax per month.
Nevada Business Real Property Tax Example: $25,000,000 x .35 = $8,750,000 assessed value x .0315 = $275,625 ÷
12 = $22,969 property tax per month - See # 4 for sources.
Based on an industrial user of 400,000 kWh per month and average rates taking into account summer and winter usage.
Source: Edison Electric Institute – Industrial Rates in effect January 1, 2013
(Rev 11/13)