Taxes Key Statistics
4.95%
Corporate Income Tax Rate
4.95%
Individual Income Tax Rate
7.19%
Combined State and Average Local Sales Tax Rate
$1,153
Combined State and Local Individual Poperty Tax Average
Tax Incentives
Economic Development Tax Increment Financing, State program (EDTIF)
The EDTIF tax credit is a post-performance, refundable tax credit rebate for up to 30% of new state revenues (sales, corporate, and withholding taxes paid to the state) over the life of the project (typically 5-10 years). It is available to companies seeking relocation and expansion of operations to the State of Utah who are looking to add at least 50 jobs with annual wages of at least 110% of county average annual wages, have demonstrated company stability and profitability, and have demonstrated competition with other locations. Companies must also obtain commitment from the local government to provide local incentives. State of Utah site
Custom Fit Training
Custom Fit Training is a partnership between the Utah Colleges of Applied Technology and other select sister institutions across the state and the local business community. Its mission is to provide customized employee training to businesses at an affordable cost. The Utah State Legislature appropriates funds each year as an investment in custom fit training. Utah Colleges of Applied Technology site
Local Incentives (Tax Increment Financing)
Cities and counties may award incentives to companies locating in Economic Development Community Reinvestment Areas (CRA) or Redevelopment Areas (RDA). Incentive dollars are generated through the creation of a net-new property tax increment that a development will generate. For example, when a company constructs a new building, its property tax increment is the result of the assessed value of the building multiplied by the property tax rate. Incentives are awarded as a percentage of the tax increment created by the development.
Incentive value will vary widely based on the parameters of a given project area (CRA/RDA). On average in Utah, the percent rebate ranges from 50-75% and the term of the project area is 10-20 years.
Authorizing agencies vary widely by community. Under the CRA statute, every taxing entity has the ability to opt-in or out of a given project. Most communities will have taxing entities representing the City, County, School District, Fire & Safety and various Special Assessment Districts (library, water, etc.). They can all be considered “authorizing agencies.”
Most taxing entities meet monthly to review TIF requests. It is generally recommended to socialize a project with each taxing entity at least 2-3 months prior to requesting a rebate. Each community and taxing entity may have unique requirements for what they will, and will not, incent. “Incentive statutes” by taxing entity vary and need to be handled in a “one-by-one” fashion.
Funding available to a given project is based on the amount of investment in real and personal property, net-new property tax increment created (the local millage rate on average in Utah is between 1.25-1.5%) and the percent rebate granted by the individual taxing entities.
The local economic developer in the community under consideration will be your liaison in navigating the TIF process. They will work with you to create a project prospectus, area budgets and support you in the individual “asks” to local taxing entities. There is no formal application process.
Other
Opportunity Zones
An opportunity zone is a new community development program established by Congress in the Tax Cut and Jobs Act of 2017 to encourage long-term investments in low-income and urban communities nationwide.
