Survey: Small Businesses Thrive When Regulatory, Tax Filings Are Easy

What makes an ideal environment that allows small businesses to flourish?

Thumbtack.com, a web site that works as a marketplace for service providers and consumers, has released what it calls the largest small business survey ever to determine what helps to create that business-friendly environment.

For the third straight year, the company partnered with the Ewing Marion Kauffman Foundation and polled 12,000 small business owners across the country.

"Creating a business climate that is welcoming to small, dynamic businesses is more important than ever, but rarely does anyone ask small business owners themselves about what makes for a pro-entrepreneur environment," Jon Lieber, Thumbtack's chief economist, said in a press statement.

"Thousands of small business owners across the country told us that the keys to a pro-growth environment are ease of compliance with tax and regulatory systems and helpful training programs."

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According to the survey, small business owners in Utah, Idaho, Texas, Virginia and Louisiana gave their states the top ratings for friendliness to small business – while respondents in Colorado Springs, Boise and Houston ranked their cities as the most small business-friendly.

On the other end of the scale, small business owners in California, Rhode Island and Illinois awarded their states an “F” – Connecticut and New Jersey both received a “D” grade. Sacramento, Providence and Buffalo, NY were also cited as some of the worst cities in the nation for small businesses.

Those taking the survey said ease in dealing with professional licensing requirements and in filing taxes were the most important regulatory issues when it came to determining a state's commitment to small businesses. Anther big issue was the availability of government job training programs. Meanwhile, only 19 percent of respondents said they were ready for the implementation of the Affordable Care Act.

"It is critical to the economic health of every city and state to create an entrepreneur-friendly environment," said Dane Stangler, vice president of Research and Policy at the Kauffman Foundation, noted. "Policymakers put themselves in the best position to encourage sustainable growth and long-term prosperity by listening to the voices of small business owners themselves."