by JJ Feinauer
It’s not just the wide open spaces that are convincing more and more businesses and individuals to relocate to Texas.
“The numbers are clear,” the National Review’s John Fund wrote Friday. “Between 1995 and 2010 over $2 trillion in adjusted gross income moved between the states,” and according to Fund, low (or nonexistent) tax rates are attracting migrators to states like Texas, Nevada and Florida.
New Jersey and Connecticut, according to Fund, are also working hard to scoop up those who feel the increasing taxes of Mayor Bill de Blasio’s New York have become too burdensome.
“You see taxes being increased there,” Fund quotes New Jersey Gov. Chris Christie as telling a group of CEOs at a Wall Street Journal forum. “You have a new mayor in New York who is aggressively talking about increasing taxes in New York City. While I feel badly for New Yorkers, come to New Jersey.”
But some, such as Peter R. Orszag at Bloomber View, think that there is a key element to inter-state migration that writers like Fund (and author Travis Brown, whose book “How Money Walks,” informed much of Fund’s argument) are overlooking: Those who are moving aren’t usually affected by the tax burdens.
“Yes, people do move from high-tax states such as New York to no-income-tax states such as Florida,” Orszag wrote on May 28. “But the vast majority of such migrants are low- and moderate-income families, who are less affected than more affluent families are by state income taxes.”
Orszag, whose article is influenced primarily by a report by the Center on Budget and Policy Priorities, uses Arizona as an example of a state with an income tax that has also experienced a high influx of “net in-migration.”
“South Dakota and Alaska have no income tax, but have been losing population,” Orszag continues, making the point that when it comes to where people want to live, weather, housing accessibility and the job market have the largest influence. For most people, according to Orszag, state income tax plays little to no role in the decision-making of most Americans.
“Surveys that do explicitly include taxes as an option have shown they play a tiny role in moving decisions,” The Washington Post’s Nraj Chokshi wrote in response to the same study. “Just 8 percent of those who said they wanted to move cited taxes as the reason.”