Wednesday, November 17, 2010

Do People Respond To Tax Rates?

Yes, people do:

Migration from high-tax states to states with lower taxes and less government spending will dramatically alter the composition of future Congresses, according to a study by Americans for Tax Reform.

Eight states are projected to gain at least one congressional seat under reapportionment following the 2010 Census: Texas (four seats), Florida (two seats), Arizona, Georgia, Nevada, South Carolina, Utah and Washington (one seat each). Their average top state personal income tax rate: 2.8 percent.

By contrast, New York and Ohio are likely to lose two seats each, while Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania will be down one apiece. The average top state personal income tax rate in these loser states: 6.05 percent.

For probably the first time in its history, California is not expected to gain any seats.

1 comment:

maxutils said...

People respond to incentives. It's a fundamental, un-circumventable economic truth, right up there with no free lunch and all resources are scarce. Oddly, while I can't speak for all of the states, I know that Arizona, Texas, Florida, and Washington ALL have much better roads than we do here in CA.