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Studies confirm that Americans migrate from high-tax to low-tax
states, according to an article by a professor of economics at Ohio
University, Richard Vedder, for the nonpartisan Heartland Institute.
“[P]eople are fleeing high-tax, big-government states for
low-tax havens where they can keep more of their income,”
Vedder wrote in the December 1 article.
Between April 1, 2000, and June 30, 2004, a net 1.4 million native-born
Americans moved from states with income taxes to the nine states
with no general income tax, Vedder wrote.
“This movement of 310,000 persons a year is a continuation
of a trend of the 1990s, when about 3 million persons made similar
moves,” Vedder wrote. “From 1990 to the present, about
4.6 million persons have fled the income tax states--a vastly larger
number than moved from East Germany to West Germany in the 15 years
before the Communists built the Berlin Wall."
Americans move to avoid all taxes, not only taxes, Vedder wrote.
“For example, my research shows 2,845,700 Americans moved
into the 10 states with the overall lowest state and local tax burden
in the 1990s, from other states. Meanwhile, there was a net out-migration
of 2,151,300 from the 10 states with the highest tax burdens.”
Vedder noted that many other factors influence migration but wrote
that “sophisticated econometric analysis” confirms a
relationship between taxation and migration.
“Recently, some scholarly studies have confirmed the aversion
of migrants to taxes for specific age groups,” Vedder wrote.
“For example, a recent study from the prestigious National
Bureau of Economic Research concluded, ‘this evidence is consistent
with the notion that wealthy elderly people change their state of
residence to avoid high state taxes.’”
“People move to find conditions conducive to a better life,"
Vedder concluded. "The tendency to move to areas with relatively
low taxes suggests that on balance migrants believe life is better
where individuals are free to spend a larger share of the money
they earn in a manner of their own choosing.”
Analysis of Census Bureau numbers by The Business Council’s
research affiliate, The Public Policy Institute, shows that New
York, with the nation’s highest state and local tax burden,
has lost population in several critical age ranges.
The data add to the evidence suggesting that New York's long-term
economic travails may be impelling an increasing number of New Yorkers
to move elsewhere, The Institute's analysis shows.
Between April 2000 and April 2003, the Census Bureau estimates
New York gained 213,294 in overall population. That is a growth
rate of 1.1 percent, the 44th-fastest growth rate in the nation.
That growth rate is well behind the national average growth rate
of 3.3 percent. Nevada is the fastest-growing state, at 12.2 percent.
New York ranked 46th in growth among young adults and 49th among
those aged 15 to 44 - those preparing to enter the workforce and
those considered in the prime creative years of their careers. And
among children five years old or younger, New York ranked last in
growth, behind 49 states and the District of Columbia.
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