News, New Jersey, New York and California Have Worst Tax Climates for Business, Tax Foundation Says.

[studiobtm]

Originally Posted by tallrick

High tax states develop the same way a parasite does. No parasite will grow large on a weak host. New York was a center of manufacturing and industry while NYC is a long time center of finance. That allowed government to grow huge. New Jersey is associated with that economy so it too became a mess. California had mining, energy, agriculture, timber, and eventually the movie industry. All developed before government grew to the life-sucking size it is now. This also happened in manufacturing centers like Michigan. The overwhelming fact is that taxes, regulations and corruption thrive best in areas that generate the most wealth. Eventually the parasite kills the host and the process will reverse. The deficits of government indicate that they have overwhelmed their hosts and in places like Detroit you can see government already falling apart.

Without new startups it is like a forest of only old growth. Eventually the insects and age will kill the trees and unless new ones start, will become a wasteland.

Worth repeating.

[studiobtm]

Originally Posted by jdm2008

So many rich people live there. How do you think they became rich? Work in Alabama and commute?

California has been living on the past for decades and the party is now over. Silicon Valley is a shell of it's past glory. Economic growth in Alabama in contrast is booming. These trends take time but over the long run high taxes and over regulation will always strangle an economy. It is a historically consistent phenomenon.

Over time when you punish producers they will seek an environment that is less hostile. Some factors, like the weather and beauty in California, can slow that trend but the effect has limits.

[NHartphotog]

I don't understand why NH would be high on this list. It has extremely high business taxes. Our property taxes are obscene: over $10,000 annually for a house that cost $500,000 at the height of the boom (all the local governments reassessed recently--to "before the crash" market levels, and 100% of that!). We have almost no restaurants within 30 miles of our house; they don't make enough profit to offset the taxes. All we get are new banks and pharmacies. For individuals, I can't wait until the housing market comes back a bit so I can move to a different state; the lack of income and sales tax is way more than offset by the property taxes. The state also nickel-and-dimes everyone to death.