Empirical studies of the economic effects of changes in state corporate income tax apportionment policies generally have used highly aggregated state-level data. This study uses individual firm-level data, from 1992 to 2002 State of Georgia corporate income tax returns, to evaluate economic development and revenue aspects of increasing the sales factor weight (and uniformly lowering weights on payroll and property) in state corporate income tax apportionment formulae. The authors find elasticities indicative of a substantial impact on local sales (-6.5 percent), payroll (2.0 percent), and property (2.1 percent) following a move to double-weighted sales. For the average firm, increases in Georgia payroll and property were $37,110 and $190,829, respectively, while the decrease in Georgia sales was $634,367. Using 1994 figures (the year prior to double-weighting), this amounts to statewide payroll and property increases of $0.6 billion and $3.1 billion, respectively, and a gross receipts decrease of approximately $10.4 billion.
