Massachusetts has one of the lightest corporate tax burdens in the country, according to a recent report by a Washington business group, a finding that is adding fuel to Beacon Hill Democrats' efforts to wring more tax dollars out of corporations.
A report released last month by the Washington-based Council on State Taxation, which represents 575 multistate corporations, found that Massachusetts businesses paid 36 percent of all local and state taxes in the Bay State, a percentage that was 47th among the states and the District of Columbia and lower than the national average of 43 percent. As a share of all economic activity, the tax burden borne by Bay State firms ranked 42d.
The conclusions echo a report released last summer by an economist at the Federal Reserve Bank of Boston, which found ''abundant evidence that Massachusetts business taxes are competitive, even from data supplied by business interest groups."
Meanwhile, the cochairman of the Legislature's Revenue Committee has been publicizing the fact that about 75 percent of the corporations in Massachusetts are so adept at avoiding state taxes that they pay the alternative minimum tax of $456.
''Pretty much every measure that comes out shows that Massachusetts can no longer be considered a high-tax state," said Joseph R. Crosby, legislative director for the Council on State Taxation.
The corporate tax burden in the Bay State is getting new attention on Beacon Hill as lawmakers scrutinize Governor Mitt Romney's plan to raise money by closing corporate tax loopholes. The governor halved his original plan after an outcry from business leaders, deciding that going too far might scare away companies and jobs. But some lawmakers are seizing on the reports as evidence that Massachusetts can get more money out of businesses without driving away jobs.
''We hear continually from lobbying groups that the state is taking too much from businesses, and they're fabricating this," said Representative J. James Marzilli Jr., an Arlington Democrat. Marzilli is pushing for Romney's original loophole package, which would raise about $170 million annually.
''Massachusetts is a high-cost state in which to live and do business, but that doesn't mean businesses should be allowed to manipulate the tax code and not pay for the services they receive," Marzilli said.
Business groups say Massachusetts must keep its corporate taxes low if it wants to compete with states that have cheaper housing, fuel, and labor costs, not to mention better weather. Romney spokeswoman Julie Teer said the governor decided to scale back his loophole package because ''the reality is there are several onerous burdens placed on employers" in Massachusetts.
Senator Cynthia S. Creem, the Newton Democrat who cochairs the Revenue Committee, is focusing on the number of corporations that end up paying the state's alternative minimum tax. Creem has proposed a bill that would raise the minimum tax, which was set in 1988, for larger companies by tying it to a firm's net worth.
In 2001, the last year for which figures are available, 109,000 of the 147,000 corporations in Massachusetts paid the minimum, and 1,100 of them had gross receipts of more than $100 million.
The caricature of Massachusetts as ''Taxachusetts," a high-tax state that is unfriendly to business, persists nationwide. Surveys last year by CFO Magazine and Chief Executive Magazine both pegged Massachusetts as one of the worst five states in which to do business. The first survey was based entirely on taxes, while the second also considered regulations and overall quality of life.
Eileen McAnneny of Associated Industries of Massachusetts said that tax rates are only part of the overall tax picture in a state and that Massachusetts has a tendency to enforce its laws arbitrarily. Business leaders were especially concerned about a provision in Romney's original loophole bill that would have made it easier for the state's top revenue official to pursue corporations that transfer their profits outside Massachusetts.
''Even if our tax burden is moderate or low, and I'm not granting that, the issue for Massachusetts is the way we administer our tax laws," McAnneny said. ''There's a lot of discretion; it can be very arbitrary. There's a huge cost with respect to either litigating or fighting some of that. That is what is particularly troubling to businesses."
Crosby of the Council on State Taxation, who has criticized Romney's zeal in closing tax loopholes, said such moves create uncertainty that is bad for business. In the last two years, the Legislature has approved loophole closings proposed by Romney worth an estimated $210 million annually.
''It's not just level of taxes; it's your level of rhetoric and whether you create a predictable and stable environment," Crosby said. ''That's where Massachusetts has stumbled over the past few years."
But Marzilli says lawmakers are likely to take a harder look at the relatively light tax burden on businesses as tight fiscal times persist and the property tax burden on Massachusetts residents continues to rise.
Scott Greenberger can be reached at greenberger@globe.com.