STATE CORPORATE INCOME TAX RATES AND BRACKETS FOR 2023:
Though often thought of as a major tax type, corporate income taxes accounted for an average of just over 7 percent of state tax collections and 4 percent of state general revenue in FY 2021. Complete information is available by the Tax Foundation.
And while these figures are not high, they represent a substantial increase over prior years. Corporate income taxes accounted for 2.26 percent of general revenue in FY 2020, which is more in line with historical norms.
Forty-four states levy a corporate income tax. Rates range from 2.5 percent in North Carolina to 11.5 percent in New Jersey. States with the highest top corporate income tax rates:
- New Jersey (11.5%)
- Minnesota (9.8%)
- Illinois (9.5%)
- Alaska (9.4%)
- Pennsylvania (8.99%)
States with the lowest top corporate income tax rates:
- North Carolina (2.5%)
- Missouri (4%)
- Oklahoma (4%)
- North Dakota (4.31%)
- Colorado (4.55%)
Nevada, Ohio, Texas, and Washington impose gross receipts taxes instead of corporate income taxes. Delaware, Oregon, and Tennessee impose gross receipts taxes in addition to their corporate income taxes. Some localities in Pennsylvania, Virginia, and West Virginia likewise impose gross receipts taxes, which are generally understood to be more economically harmful than corporate income taxes.