Study: Ind. tax code discourages small businesses

INDIANAPOLIS (AP) - A new study suggests that Indiana's tax code discourages small, home-grown businesses that fuel job creation.

The study by Ball State University's Center for Business and Economic Research looked at Indiana's business tax structure. Center director Michael Hicks tells The Indianapolis Star that the worst thing you can be in Indiana "is a small manufacturing company that has organized itself as a corporation."

He says those are exactly the kind of companies the state should want to be creating jobs.

Hicks and co-author Hilary Fichter found several tax code inequities that result in larger, service-oriented businesses almost uniformly paying a smaller share of total revenue in state taxes than smaller, manufacturing-based firms.

The Indiana Economic Development Corporation defended the state's tax structure in an e-mailed statement.