The Small Business and Entrepreneurship Council (SBEC) has ranked Texas the second-best state in America for small-business development for 2010.

The council released its Business Tax Index: Best to Worst State Tax Systems for Entrepreneurship and Small Business report. The report analyzes and combines 16 different tax measures into one tax score for all 50 states and the District of Columbia, including income, capital gains, property, death/inheritance and unemployment taxes. The report also takes into account various consumption-based taxes such as state gas and diesel levies.

"Taxes at the state and local levels matter by diverting resources from and reducing incentives for productive, private-sector risk taking that generates innovation, growth and jobs," says Raymond J. Keating, chief economist for SBEC and author of the report. "Quite simply, economic recovery will be restrained by high or increasing taxes, or boosted by low or falling taxes. Governors and legislators have a choice."

The Small Business and Entrepreneurship Council is a nonpartisan, nonprofit small-business advocacy organization. The full report is available here.