BUSINESS
COSTS Kentucky
is among the lowest of all states and the District of Columbia based on all overall
business cost index of tax burden and energy and labor costs. (Regional Financial
Associates).
CORPORATE INCOME TAX
Companies
doing business in Kentucky are subject to a very moderate Corporate Income Tax.
The taxable income is determined by applying the state apportionment formula to
the total corporation's income.
INCOME TAX ADVANTAGE
Net operating losses can
be carried forward for up to 15 years and back for 3 years.
A
multi-state corporation sustaining a tax loss only at its Kentucky facility during
its first year can carry the loss forward as a deduction from the second year
Kentucky taxable income.
The
taxation of the income of multinational corporations is limited to their US domiciled
corporations.
KENTUCKY CORPORATE INCOME TAX
Based
on taxable net income of the Kentucky business operation. The income of a multi-state
corporation is apportioned to Kentucky based on three factors:
Property
Payroll
Sales
by destination with double weight to the sales factor.
Tax
Rate Schedule for the Kentucky corporate income tax
First
$ 25,000 net income
4
%
next
$ 25,000
5
%
next
$ 50,000
6
%
next
$ 150,000
7
%
All
net income over $ 250,000
8.25
%
LOCAL FEES AND LICENSES
The
City of Marion levies an occupational license tax of 0.75 % on all wages, salaries
and commissions earned within the city. A net profits tax of 0.75% and a $25 business
license fee are levied on all businesses within the city. The business license
fee is credited toward the net profits tax.
PROPERTY TAXES
Local
property taxes are the major source of revenue for the local jurisdictions, including
school districts. Property taxes are levied separately for the counties, cities,
and school districts
SALES TAX
A
6% sales tax is collected on retail sales. Major exemptions include motor fuels,
take-home foods, prescription medicines, medical supplies, residential utilities
and fuels for residential purposes.
KENTUCKY ECONOMIC DEVELOPMENT
FINANCE AUTHORITY - KEDFA
KEDFA
provides low-interest loans and industrial revenue bond financing to non-retail
manufacturing and manufacturing support businesses. Also, it administers a variety
of tax credit programs to encourage investment.
KENTUCKY RURAL ECONOMIC DEVELOPMENT
ACT
Corporate
income tax credits and a 4% wage assessment allow manufacturers that locate in
Crittenden County to recoup their entire investment in land, building and equipment,
including interest, for up to 15 years. Companies must have a minimum investment
of $500,000 and create at least 15 full-time jobs to be eligible.
INDUSTRIAL DEVELOPMENT BONDS
IRBs
issued by state and local governments in Kentucky can be used to finance manufacturing
projects and their warehousing areas. Bonds issued under the US Internal Revenue
Code (IRC) are more restrictive than Kentucky statutes. Bond funds may be used
to finance the total project costs including engineering, site preparation, land,
buildings, machinery and equipment, and bond issuance costs.
BLUEGRASS STATE SKILLS CORPORATION
(BSSC)
The
BSSC was established in 1984 by the Kentucky General Assembly to stimulate economic
development through customized business and industry specific skills training
programs. The BSSC grant program is available to new, expanding, or existing business
and industry. The Skills Training Investment Credit Act provides tax credits to
existing businesses for skills upgrade training.
LOCAL INCENTIVES
The
CCEDC will work with prospective companies to put together a complete incentive
package. Among other options available locally is a low interest loan fund managed
by the city, as well as low interest loan funds available through the Pennyrile
Area Development District.
