The Tax Foundation, a nonprofit and nonpartisan tax research group in Washington, D.C. has released its latest edition of the State Business Tax Climate Index, which ranks the tax systems of the 50 states.
Nevada came in at Number 4, which means the state had the fourth-best tax climate on the first day of the 2011 fiscal year, or July 1, 2010.
South Dakota's tax system was ranked first, making it the most welcoming to economic activity, and was followed by Alaska and Wyoming at second and third.
The goal of the index is to focus lawmakers' attention on tax fundamentals.
Absence of a major tax is a dominant factor in vaulting states to the top 10, the report stated.
Because Nevada has no corporate or individual income tax, it consistently performs well in the ranking. The state was No. 4 for FY 2010 and No. 3 for FY 2009.
Among individual components considered for the State Business Tax Climate Index, Nevada ranked third for corporate tax index rate, sixth for individual income tax rate, 43rd for sales tax index rate, 40th for unemployment insurance tax index rate and 17th for property tax index rate.
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