An Examination of Virginia’s Ranking in the Best/Top States for Business Prepared for Virginia Chamber Foundation Presented by Robert Sumichrast, Dean Richard Daugherty, Director January 26, 2017

Q & A SLIDES 37

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES Capital Intensive Manufacturer Steel Company Source: Location Matters, KPMG & Tax Foundation 38

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES New Capital Intensive Manufacturer Steel Company Income Tax Property Sales UI Total Effective Tax Rate Virginia 0.0% 22.6% 1.0% 2.0% 23.8% North Carolina 2.7% 6.0% 1.3% 0.2% 10.2% Georgia -1.3% 5.9% Texas 0.1% 17.5% 1.9% 19.8% Utah 1.8% 4.8% 0.4% 8.3% Colorado 1.1% 18.5% 21.0% Minnesota 2.3% 1.4% 0.8% 4.6% Source: Location Matters, KPMG & Tax Foundation 39

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES Labor Intensive Manufacturer Heavy Transportation Equipment Manufacturer Source: Location Matters, KPMG & Tax Foundation 40

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES New Labor Intensive Manufacturer Heavy Transportation Equipment Manufacturer Income Tax Property Sales UI Total Effective Tax Rate Virginia 0.1% 8.5% 2.3% 0.5% 11.4% North Carolina 2.9% 3.1% 6.5% Georgia -3.6% 2.8% Texas 0.2% 9.6% 4.5% 14.8% Utah 3.2% 2.1% 0.9% 9.0% Colorado 2.7% 8.8% 15.2% Minnesota 4.2% 3.4% 9.8% Source: Location Matters, KPMG & Tax Foundation 41

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES Distribution Center Third-Party Logistics Provider Source: Location Matters, KPMG & Tax Foundation 42

TOTAL EFFECTIVE TAX RATES, % COMPARISON OF SELECTED STATES New Distribution Center Third-Party Logistics Provider Income Tax Property Sales UI Total Effective Tax Rate Virginia 4.6% 24.2% 5.5% 1.0% 35.2% North Carolina 4.4% 12.2% 7.3% 24.9% Georgia -6.9% 11.6% 13.0% Texas 3.1% 39.4% 9.2% 52.7% Utah 1.4% 8.9% 6.2% 1.8% 18.4% Colorado 1.2% 36.3% 7.6% 0.9% 46.0% Minnesota 0.2% 33.4% 7.9% 4.1% 45.6% Source: Location Matters, KPMG & Tax Foundation 43