The Tax Foundation published their 2014 edition of the State Business Tax Climate Index on October 9, 2013. This report enables us to gauge how well a state government compares to the other states. An even better gauge is comparing a state now to how well the state was working four years ago.
The 2010 map and the 2014 map have both the bottom 10 states in the darkest shade. The 2010 map has the top ten states in white, and the 2014 map has the top 10 states in gray. Some of the states remain in the same group in both 2010 and 2014, but the ones that change are very telling.
In 2010 Iowa and Ohio were in the bottom 10 with their Democrat Governors. In 2014 they both have Republican Governors and are not in the bottom 10. In 2010 Connecticut and North Carolina were not in the bottom 10 with a Republican Governor in Connecticut and a Democrat in North Carolina. In 2014 they were both in the bottom 10 with liberal Democrat Governors. The citizens of North Carolina had the good sense in the 2012 election to elect a Republican Gov. McCrory in North Carolina. The Tax Foundation report included this about North Carolina:
In July of 2013, North Carolina legislators passed historic tax reform that fundamentally restructured the state’s tax code. Effective in 2014, the individual income tax will be transformed from a graduated bracket system with a top rate of 7.75 percent to a simplified structure with a single 5.8 percent rate, with a further reduction to 5.75 percent in 2015. The corporate rate will be cut from 6.9 percent to 5 percent, with potential trigger cuts that may bring the rate as low as 3 percent by 2017. The estate tax was repealed retroactively to January 1, 2013 (reflected in this year’s Index scores). These changes are expected to improve the state’s ranking in the Index from its current 44th place to 17th overall.
The Tax Foundation also has encouraging news about Wisconsin:
On July 6, 2013, Wisconsin passed SB 200, which retroactively cut the top individual income tax rate from 7.75 percent to 7.65 percent while collapsing the number of brackets from five to four. Additionally, a provision brought Wisconsin in line with the federal treatment of mineral depreciation for corporate income tax purposes. Unemployment tax reforms will likely additionally improve the unemployment insurance taxes component of this report. These reforms, while positive, were not included in our analysis as they were enacted after July 1, 2013, despite being retroactive to January 1, 2013. They will be reflected in future editions of the Index, and backcasted if necessary. Both reforms are positive and will improve Wisconsin’s score.
New Jersey is the only other state in the bottom 10 with a Republican Governor, Chris Christie. He trumpets his achievement of moving New Jersey from 50th to 49th and pledges he will always have New Jersey ranked higher than New York. Some of us think this is a rather low bar to trumpet as a great success.
The top ten states from 2010 to 2014 have only one change. In 2010 Delaware was ranked in 8th place and Indiana was in 12th place. In 2014 Delaware is in 13th place with their liberal Democrat Governor Jack Markell and Indiana is in 10th place with Republican Governor Mike Pence. Are we beginning to see a pattern? The same pattern is obvious with the states that are in the middle of the pack.
- Maine ranked 34th with a Democrat Governor in 2010 and 29th with GOP Governor LePage in 2014
- Louisiana ranked 35th with a Democrat Governor in 2010 and 33rd with GOP Gov. Jindal in 2014
- Kansas ranked 32nd with a Democrat Governor in 2010 and 20th with GOP Gov. Brownback in 2014
- Arizona ranked 28th with a Democrat Governor in 2010 and 22nd with GOP Gov. Brewer in 2014
- Pennsylvania ranked 27th with a Democrat Governor in 2010 and 24th with GOP Gov. Corbett in 2014.
- Tennessee ranked 22nd with a Democrat Governor in 2010 and 15th with GOP Gov. Haslam in 2014
- Michigan ranked 17th with a Democrat Governor in 2010 and 14th with GOP Gov. Snyder in 2014
Right now a lot of Washington DC establishment want us to focus all our attention on them as though they are more powerful and consequential than anything else. All they are doing is proving how much we need to replace them as soon as possible. There is one thing Texas Gov. Rick Perry said when he announced his bid for the Republican nomination for President August 13, 2011 in Charleston South Carolina that I’ll never forget.
I’ll work to try to make DC as inconsequential in your life as I can.
We need to elect and send to DC more people with that kind of purpose.
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