Advantages of doing business in New York
New York is a premier state for research and technology, offering various tax-based, resource, and training incentives to attract businesses in innovative sectors such as tech, life sciences, and advanced manufacturing. As part of its Excelsior Jobs Program, New York provides an R&D tax credit of up to 50% of their federal R&D credit that relates to R&D expenditures in New York State with a cap of 6% of qualified research expenditures conducted in the state; a jobs tax credit of up to 6.85% of wages per net new job; and an investment tax credit of 2%. Qualified green projects can claim higher tax credits.
In CNBC’s review of top states for business, New York State is given a grade of A- in the category of tech and innovation.
Other advantages of doing business in New York are a robust economy, access to capital, a highly skilled workforce, and a large and diverse consumer market.
What is the cost of doing business in New York?
New York has a heavy tax burden and a high cost of living. New York City frequently appears at the top of the list for most expensive cities in the world.
The state's overall tax climate is ranked 49 out of 50 states by the Tax Foundation. As part of the fiscal year 2024 budget, New York extended an increased corporate tax rate of 7.25% for taxpayers with business income over $5 million.
Operational expenses can also be significantly higher compared to other regions. On January 1, 2024, minimum wage will increase to $16 in New York City, Westchester County, and Long Island. For other parts of the state, the minimum wage will increase to $15.00.
Infrastructure
Infrastructure in New York State is generally considered to be in good condition but with some areas in need of improvement. New York received an overall grade of C by the American Society of Civil Engineers.
As part of the fiscal year budget for 2023, Governor Hochul announced a $32.8 billion, five-year plan focused on improving local roads and bridges.
What are the other challenges of doing business in New York?
In addition to the high cost of doing business, a complex regulatory environment is usually cited as a key challenge for many New York businesses.
In New York City specifically, there are over 6,000 rules and regulations governing businesses. Businesses must comply with a variety of licenses, permits, and processes in order to operate legally.