Stephen Moore, a distinguished economist at The Heritage Foundation who formerly wrote for The Wall Street Journal, recently wrote about the masses moving from New York to Florida to escape high state income tax rates.
“This is the big demographic story of our country that may be the biggest economic story,” Moore said on “The Daily Briefing.” According to Moore, there are “five states of the apocalypse” – New York, California, New Jersey, Connecticut, and Illinois – where the U.S. is seeing high rates of residents leaving over high taxes and financial problems.
These residents are leaving states like New York, a densely populated and major commercial, financial and cultural center of the United States, for states such as Florida, Tennessee, Texas, Utah and North Carolina.
The moving activity spiked during the federal tax overhaul in 2017. Although tax rates were cut for corporations and individuals, the ability of residents to deduct state, city, and property taxes from their federal returns in places like New York, New Jersey, and Connecticut was significantly diminished. Other heightened tax obligations have been implemented as well, such as the July 1st “mansion tax” in New York to help pay for the city’s subway system.
These tax matters carry heavy weight because the United States has separate federal, state, and local governments with taxes imposed at each level. Out of 50 states, 43 impose state income tax requirements in addition to the required federal income tax. These tax rates vary by state, which is why many from expensive tax states like New York and California are leaving for states with no state income tax at all, like Florida.
Florida Vs New York:
New York and Florida are similar in size, population, and racial profiles. Each attracts plenty of immigrants each year. According to the Hill Finance, a $100,000 salary would only be equivalent to $87,000 in New York. In Florida, the same $100,000 is worth roughly $101,000. Tally up the totals and it’s easy to understand why so many people flee New York for Florida. At the end of the day, the price of staying in New York is nearly double that of Florida.
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