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Do Higher Taxes Chase Away People, Wealth, and Jobs?
Myth
Higher taxes won’t hurt Illinois’s economic competitiveness.
Fact
Low-tax states outperform high-tax states in attracting people, wealth,
and jobs.
Budget & Tax Brief
Kristina Rasmussen is the Executive Vice President at the Illinois Policy Institute. The Illinois Policy Institute’s
Fact Finder series aims to debunk myths about public policy issues that affect Illinois.
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Source: U.S. Department of Commerce: Census Bureau and Bureau of Economic Analysis and Illinois Policy
Institute.
Note: The lowest-taxed states (2008 state and local taxes as a percentage of personal income) include
Oklahoma, Texas, South Carolina, Colorado, Missouri, Oregon, Alabama, Tennessee, New Hampshire, and South
Dakota. The highest-taxed states include Alaska, New York, Wyoming, North Dakota, Hawaii, Maine,Vermont,
New Jersey, New Mexico, and Connecticut. Illinois ranks 23rd-highest.
Endnotes
1 Arthur B. Laffer, Stephen Moore and Jonathan
Williams, “Rich States, Poor States: ALEC-Laffer
State Economic Competitiveness Index, Third Edi-
tion,” (Illinois), American Legislative Exchange Coun-
cil, 2010, http://tinyurl.com/2ctyzd6.