Study Demonstrates Higher Tax Burdens Turn Away Businesses

From the so-bloody-obvious-why-was-a-study-needed department we have a study that demonstrates the bloody obvious, higher tax burdens push away businesses:

The study provided two lead rankings: economic outlook and economic performance.

Economic outlook takes into account 15 state policy variables – pictured right – for which Louisiana improved from 24th in 2008 to 16th in 2011.

California, Illinois, New Jersey, Vermont, and New York were the lowest five in the rankings for economic outlook – in that order – while Utah achieved the highest score, followed by Colorado, Arizona, South Dakota, and Florida.

The entire study can be found here [PDF]. Common sense should allow people to come to the realization that businesses are more likely to leave one state for another if that move means paying far less money to a government entity. Remember that every dollar a business has to send to the state is one less dollar that can be spend on employee salaries, benefits, research and development, new facilities, and every thing else businesses pay for.

A state can get away with taxing only so high until that tax burden becomes enough for those being taxed to consider moving somewhere else. Businesses especially have a major bargaining chip in this economy as they are the only providers of wealth generating jobs. If states wish to keep unemployment from increasing they’ll have to create a business friendly environment to attract new employers. Increasing taxes isn’t the way to do that and as California is learning is actually the exact opposite of what should be done.

One thought on “Study Demonstrates Higher Tax Burdens Turn Away Businesses”

  1. I have come to the conclusion that most research is pseudo-science. I allow for the possible existence of real science and its benefits but for social science I simply go with common sense. By that I mean my common sense. As a public school teacher I have to deal with the ignorant class on a regular basis. That class is the faculty, I expect the students to be ignorant.

    Grace and Peace.

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