Yes taxes matter, but Labor costs are the biggest reasons. Taxes pale in comparison to employee "minimum wage" and all the extras like unemployment tax, benefits, matching soc sec deduction etc, etc. Not to mention the cost to have people like me to process all that. I just did an 8 year stint processing payroll for 350+ employees in an upscale retirement community.It's mind boggling.
Labor is expensive when truly accounted for but it's not ruinous; e.g., I'm at approximately 135% of gross wage to carry each employee which is fairly cheap.
Taxes are horrific. My state, county and municipality are essentially insolvent and vastly over-staffed (note the correlation) and thus my property taxes have been going up approximately 10% per year for the past decade. Regulatory and licensing fees are the same and increasingly regulatory compliance is being utilized as a revenue-generating scheme. Income taxes are tricky; e.g., no bonus depreciation here because there's not way in the tax code to propagate it from the entity through to the individuals thus we're forced to manage physical inventory across annual boundaries to manipulate our tax bill rather than just engaging in capex when, and to the extent, it makes sense.
The single greatest reason to not do business in the USA is risk. Physical assets and employees present unavoidable risks that are most easily managed by having less of both. A few examples:
My first post-college employer was a very large multinational that entered the transistor business at nearly the time of its inception. Behind their first production facility were buried tanks holding solvents & other chemicals a few gallons leeched into the soil. You wouldn't want to mix this stuff in your vinaigrette but a couple hundred gallons on my lawn wouldn't cause me to lose any sleep. Initial settlement: nearly a billion dollars and multi-million dollar annual monitoring & remediation costs for levels that are so low as to be nearly immeasurable now.
Closer to home: I woke up a few weeks ago to a headline that the EPA had passed a new rule with all exemptions for small business stripped out at the eleventh hour. If imposed as promulgated I'll have to close a business and put the employees who staff it on the street. Cost of compliance as mandated exceeds my *gross* income. It will be the same for roughly 40% of my industry in the USA and 70+% of the second largest industry in my state (imagine what my taxes will look like then). The alleged harm? Trace methane emissions contributing to global warming (they don't exist in measurable amounts but proving that to the EPA's satisfaction will be financially impossible).
A few other local examples: a trespasser fell through a skylight on a warehouse and broke his back; result - bankruptcy of the business because insurance refused to pay. Two vehicles pass on a gravel road, one subsequently moves to center and has head-on collision with oncoming vehicle. Result - employer of teenager driving oncoming vehicle exhausts several million in insurance and loses around half his assets to driver of vehicle that moved to center. Welding supply business changes hands; environmental inspection finds "contamination" of soil with trace amounts of acetylene (a chemical so harmless it has been used as an anesthetic); EPA orders several acres dug out to a depth of 30' with removed soil to be sanitized by burning in large kilns; result - bankruptcy of business and individual, small multi-generational fortune lost to regulatory fiat.
And just for fun: in my second business I'm required to keep a list of assets with a regulatory agency (my business is record owner at the local courthouse as well so it's not like there's any question). Said agency took it upon themselves to move, without notice, a few assets from my business to the inventory of a defunct unlicensed business dissolved by the court in litigation years earlier which was owned by a hostile, litigious and deceased third party. Said third party's widow discarded the agency's demands for compliance. The agency subsequently denied renewal of my license alleging that the deceased third party was "affiliated" with my business because, wait for it, we share an unusual last name. Five figures in legal fees and nearly six in lost revenue due to work stoppage while we straightened the mess out and we're back in business but with no recourse against the agency for their improper actions.
Though those things don't really apply to FAS why would anyone do business here if they didn't have to? If it were physically possible to outsource my businesses they'd already be long gone.