February 5, 2014
February 5, 2014
Washington Poised for Economic Boom
By Oregon Tax News,
The State of Washington is better positioned for economic growth than Oregon or California, according to Forbes Magazine.
Forbes recently published its list of top 10 states poised to grow in the next five years, and Washington made the list because of its strong aerospace and technology sectors, as well as its vibrant export economy. Other states making Forbes’ growth list include North Dakota, Utah, Texas, Virginia, Wyoming, Washington, Maryland, Colorado, Massachusetts and South Dakota. Reasons behind projected growth varied for each state but included, among other things, access to energy sources, investments in high tech, economic diversification, pro-business policy climate, and the influx of young and educated families.
Of the three West Coast states, Washington consistently ranks as a more pro-business state than Oregon or California, particularly with respect to key growth indicators. Last year, Forbes also listed Washington as a top 10 “business friendly state” based on a comprehensive set of factors that included cost of doing business, regulatory environment, economic climate, growth prospects and quality of life. In that report, Washington ranked #9 while Oregon and California ranked #19 and #39, respectively.
According to the Tax Foundation’s most recent State Business Tax Climate Index, which scores and ranks states on whether their tax policy attracts business and spurs investment, Washington’s business tax climate ranks among the nation’s best at #6. By Contrast, California ranks as the third worst climate in the nation at #48. Oregon ranks #12, but its lack of sales tax actually pads its score, according to the report. When other factors are considered, Oregon’s tax climate may appear less attractive to businesses. Oregon’s corporate, individual income and unemployment insurance taxes, for example, fall into the bottom half of states.
California’s economic situation, in particular, has been dire in recent years. Though the state has seen some improvement, recent economic growth remains historically anemic and the flight of wealth to other states, including Oregon, is well-documented. California’s unemployment rate also sits at 8.5%—well above the national average and significantly higher than Oregon (7.3%) or Washington (6.8%). A recent study by Stanford’s Hoover Institute and YouGov reveals that the vast majority of Californians remain pessimistic about the state’s future economic prospects.