Low Business Costs

Missouri provides you with a solid business foundation, financial and otherwise. In Missouri, taxes and business costs don’t eat up all of your company’s profits.

An important tax advantage for Missouri businesses is the amount of income considered taxable as only income earned in Missouri is taxed. Two allocation options are offered for calculating this income: (1) the three-factor formula, based on sales, property and payroll or (2) the single-factor formula, based only on sales. Missouri is one of only two states to allow companies to annually select the income allocation formula that results in lower corporate income tax liability.

In addition, it is important to note that Missouri has not adopted worldwide or nationwide unitary tax assessment in computing multinational corporate income tax liability.

Benefits like our low business and labor costs, reliable and inexpensive energy, aggressive and performance-based incentives and a statewide commitment to attracting companies and investment, make Missouri a place where your company can come to grow and thrive. Let’s talk and find out how we can assist you in improving your profitability and lowering your business costs.

 

  • Low tax rates make Missouri a great business expansion location

    Tax Rates

    Corporate income tax: 6.25%—50% of federal income tax payments may be deducted before computing taxable income, leading to an effective rate of 5.2%

  • Taxable income apportionment formula: 3 factor or sales
  • Personal income tax: up to $315 plus 6.0% of federal taxable income over $9,000
  • Property tax: Commercial and industrial property assessed at 32%; personal property at 33 1/3%.
  • Business inventories are not taxed. Tax rates are the aggregate of local taxing districts and a .03 state tax.
  • State sales and use tax: 4.225%
  • Unemployment insurance taxable wage base: $13,000
  • Unemployment insurance new employer entry rate: 2.7%

 


Missouri is a low tax state

Tax Rankings

  • 1st lowest business taxes per employee in the U.S. (Ernst & Young).
  • 2nd lowest total effective business tax rate (TEBTR) (Ernst & Young).
  • 5th best corporate income tax index in the U.S. (Tax Foundation).
  • 7th best property tax index in the U.S. (Tax Foundation).
  • 7th best unemployment insurance tax index in the U.S. (Tax Foundation).
  • A better overall tax climate for business than most of its surrounding states, including Kansas, Illinois, Iowa and Oklahoma (Tax Foundation).
  • Click here to download tax climate rankings for Missouri and surrounding states, or for more information on Missouri’s tax rates, download the Missouri business tax profile.

 


  • Energy Costs

    Commercial electricity costs are nearly 13% lower than the U.S. average, at 9.07 cents/kWh (EIA, 2016).

  • Residential electricity costs are nearly 14% lower than the U.S. average, at 10.89 cents/kWh (EIA, 2016).
  • Click here to download a Missouri utility cost comparison.

 

 

 

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Missouri Electricity Price Data (Excel)

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In Their Words

There are cost advantages to working out of Missouri. Corporate taxes, fuel taxes and property taxes are very low in the state. Utility costs among the lowest in the country.

— Hugh Gilmore / Integrated Wind Energy

For manufacturing, overall costs of labor, utilities, cost of land and buildings and the skilled labor pool, Missouri is one of the best values in the country.

— Patrick Leinert / Leinco Technologies

The work ethic here is really good. People come in and work hard. They’re used to working hard before we hire them.

— Jack Prim / Jack Henry & Associates

I've lived in a lot of places, and there is a difference here in how people conduct themselves. There is a strong work ethic and friendliness that I haven't found elsewhere.

— Dr. Susanne Cohen / Triumph Pharmaceuticals