People and Businesses Want to be Where Taxes are Low


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Parasites are not supposed to kill their hosts. In California, New York, and Illinois they may be. 

 

Last month the IRS stated that it would no longer provide tax migration information to the public. It seems the constant outflow of residents from states such as California and New York due to high levels of taxation irked some of the powers that be. So, the feds will no longer provide us with the information. It was getting embarrassing, I will say that.

It can be argued that the only reason people still live in California is because of the fantastic weather, the fantastic geography, and the (practically) legal pot. Now that pot is legal in Colorado too only 2 legs in the California “stool of cool” remain. I am half joking.

People and businesses want to be where taxes are low and government relatively small. If you were opening up a manufacturing plant today and you had the choice between California, with its unbelievable regulations and taxes, or Louisiana which may soon have no corporate income taxes and no state income taxes. Which would you choose? A generation ago the choice for most businesses would have been California. A slam dunk every time. But not so now. Louisiana, Louisiana, beats the Golden State flat out. The Golden State loses to the Pelican State.

Cut taxes. Make business easier to do. This is the lesson of many economic success stories from Hong Kong, to Singapore, to the Isle of Man, to Chile, to Texas. Go the other way and tip into despair.

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