Oct. 15, 2012
FOR IMMEDIATE RELEASE
CONTACT: Brian Balfour (919) 834-2099
Brian.Balfour@nccivitas.org
Laffer, Moore co-author report that illustrates how no-income tax states prosper
RALEIGH – The Laffer Center for Supply-Side Economics at the Texas Public Policy Foundation has joined the Civitas Institute to publish a recent analysis of income taxes at the state level. The study, “Taxes Really Do Matter: Look at the States,” authored by Dr. Arthur B. Laffer, a former advisor to President Ronald Reagan, and Stephen Moore, senior economics writer for the Wall Street Journal, debunks recent claims that state income taxes don’t affect those states’ economies.
In the report, Laffer and Moore found that in any 10-year period in the last four decades, the no-income tax states – Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming – consistently outperform the equivalent number of the highest income tax states – Oregon, Hawaii, New Jersey, California, New York, Vermont, Maryland, Maine and Ohio. No-income-tax states experienced a 14 percent population growth versus only 5.5 percent for the highest income tax states. Similarly, job growth in the no-income tax states was 5.5 percent — while jobs decreased 1.6 percent in the highest-tax states.
“The California/Texas comparison is especially interesting as California has one of the highest income tax rates at 10.3 percent and Texas has no income tax,” said Laffer. “Over the 10-year period studied, Texas gained nearly 870,000 transplants from other states while California lost over 1.5 million residents.”
“This study has major implications for North Carolina lawmakers considering tax reform in 2013,” said Civitas Institute Director of Policy Brian Balfour. “Laffer and Moore clearly demonstrate that theory and evidence both support the elimination of the state income tax to be the boldest, most pro-growth option for tax reform.”
The data clearly show that Americans are moving to low-tax states and moving away from high-tax states — and taking their incomes along with them. “You can’t tax an economy into prosperity,” said Laffer.
The report is available here.
More information on the Civitas Institute is available at www.nccivitas.org, or contact Communications Director Jim Tynen at (919) 834-2099.
The Laffer Center for Supply-Side Economics is a partnership with the Texas Public Policy Foundation dedicated to preserving and promoting the core tenets of supply-side economics.
The mission of the Civitas Institute is to facilitate the implementation of conservative policy solutions to improve the lives of all North Carolinians.
“You can’t tax an economy into prosperity,” said Laffer.
That brings to mind the Obama Administration handling of the business community:
“Daily floggings will continue until morale improves.”