While the national headlines have been filled with gloomy news about vaccinations, masks, and inflation, a much sunnier storyline has begun to emerge in states. And it’s happening because of those bad national stories.
In a trend initially started by GOP-led states, Democratic-led states are getting in on an anti-tax movement that is attracting people and businesses like never before.
And the coronavirus crisis has sped up that migration away from high-tax states, according to Grover Norquist, the president of Americans for Tax Reform. In a historic flurry of action, some governors and legislatures have sped up cuts to income, business, and other taxes, including gas, groceries, and even diapers. Add to that the success of COVID-19-era telecommuting, and the latest Great Migration has begun.
“You don’t have to be in San Francisco to be high-tech. You don’t have to be in New York to be in finance,” said Norquist.
“You don’t move when you retire. You move when you want to. People who might have left five, 10, 15 years from now and gone to Florida are doing it earlier,” he added.
Jared Walczak, the vice president of state projects for the Tax Foundation, said states have done so well during the virus crisis that 16 states cut taxes last year and that more plan to follow this year.
“Whereas 2021 was largely a year of Republican-led rate reductions, 2022 is shaping up to be the year of bipartisan tax relief. Tax cuts are on the menu across the country, and there are many selections on that menu: individual and corporate income tax cuts, sales tax cuts, property tax relief, exemptions, and more,” he said.
“Wherever you turn, lawmakers are looking for ways to return at least some of the states’ additional revenue collections to the taxpayers,” added Walczak.
Helping that migration to mostly Southern states has been a realization by transplants from high-tax states that spending more on government doesn’t necessarily translate into better services.
“Florida spends half what New York state spent, state-to-state. Half! Half! They’ve got roads. They’ve got schools. They’ve got better roads. They’ve got better schools. Everything you’d want is twice as expensive in New York because of pensions, because number of staffers, because of union rules, all those sorts of things,” said Norquist.
And, he added, as the trend has grown across the country, the appetite for compromising on taxes has eroded and is likely over, especially as citizens get used to lower taxes.
“Back in the ’50s, the ’60s, the ’70s, the Democrats wanted lots of taxes. The Republicans would agree to some. The Democrats wanted lots of spending, and the Republicans would agree to more of it. And they call it a compromise,” said Norquist.
“There’s no compromise between higher taxes and lower taxes. Somebody wins and somebody loses on that one,” he said, adding with a chuckle, “Every time I hear somebody with some stupid spending idea, I think, ‘Wait a minute. That’s my money you’re playing with.'”
