Gee, who would have ever guessed that? I’m glad I live in Texas! This is from Tax Prof Blog:
States That Spend Less, Tax Less—and Grow More
Wall Street Journal op-ed: States that Spend Less, Tax Less—and Grow More, by Dave Trabert & Todd Davidson (both of the Kansas Policy Institute):
States with an income tax spent 42% more per resident in 2011 than the nine states without an income tax. States in the bottom 40 of the Tax Foundation’s Business Tax Climate Index (which assesses business, personal, property and other taxes) spent 40% more per resident. In the American Legislative Exchange Council’s Rich States, Poor States Economic Outlook (based on 15 policy variables), the bottom 40 spent 35% more than the top 10 states. … [T]he states with no income tax, plus those included in the Tax Foundation and Rich States, Poor States rankings (18 in all) are quite diverse: large, small, coastal, inland, bordering Canada and Mexico, densely and sparsely populated. …
States that allow taxpayers and employers to keep more of their earnings are reaping the benefits. States without an income tax have significantly better growth in private sector GDP (59% versus 42%) over the last 10 years. They increased the number of jobs by 4.9% while jobs in the rest of the states declined by 2.6%. States without an income tax gained population (+5.5%) from domestic migration (U.S. residents moving in and out of states) while all other states as a whole lost 1.3% of population between 2000 and 2009. … The path to superior economic growth and job creation is clear.