Editor's note

Longtime attorney for the public interest,Greg Silver, is this week’s guest onWho Gets What. Greg finds among the obstacles to environmental sustainability is the local agency in control of zoning and development. Listen toWho Gets Whatwherever you find podcasts or atmortonjohn.libsyn.com

If you listen to the leading voices in Indiana, you’ll hear we have the highest ranking as a business-friendly state. And they’ll tell you it’s because we have the most business-friendly tax program in the nation.

Of course, not everybody agrees that being business- friendly is good for Hoosiers. But then complacent and compliant Hoosiers are mighty glad to be at the top of any ranking in the football season.

One ranking, where we are only tenth of the 50 United States, comes from the Tax Foundation which describes itself as…”the nation’s leading independent tax policy research organization. Since 1937, our research, analysis, and experts have informed smarter tax policy at the federal, state, and global levels. Our Center for State Tax Policy uses research to foster competition among the states and advises policymakers on how to improve their tax systems." [Emphasis added.]

The Foundation does a thorough job of researching the various tax codes and the academic articles concerning the impact of taxation on business location. As the Foundation says above, they use “research to foster competition among the states.”

Here, in “A state that works” “For the Bold,” we’re all for high rankings and competition. As it is in football, so should it be in government policy.

No matter that bold competition can lead to concussions for the citizens who get incapacitated by “smarter tax policy.”

Indiana’s tenth ranking for 2024, (the Foundation is always ahead of its times) is identical to its ranking for 2014. In some of the intervening years we were ninth and we’re not always highly ranked in various components of the Foundation’s Index.

With our beloved property tax, we enjoy our best ranking for 2024: third among the states. We might complain, but the Foundation thinks highly of this tax for fostering competition among the states.

Our low property taxes for businesses may deny localities amenities like quality education, good roadways, clean water, and other niceties of community living. But they support competition.

Competition among communities is what certain economists praise as “voting with your feet.” You don’t like the public services and/or taxes here, then go somewhere else. Folks will find the balance between taxes and the services they value.

It’s not a race to the bottom; it’s freedom, it’s liberty, and it’s good for business.

But we could do even better. Our corporate tax ranks 12th in the nation. The individual income tax, despite being perpetually reduced, ranks 16th.

Indiana’s state sales tax, tied with Tennessee at the highest rate in the nation (7%), is somehow 18th according to the Foundation. Worst of all, our unemployment tax is 25th.

Yes, we can improve our tax friendliness for business, if that’s what we want.
Morton J. Marcus is an economist formerly with the Kelley School of Business at Indiana University. His column appears in Indiana newspapers, and his views can be followed his podcast.

© 2026 Morton J. Marcus

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