Texas, Florida gain from blue state exits

 Wall Street Journal:

Illinois Gov. J.B. Pritzker shrugged last year after several high-profile corporations left his state. “Countless companies are choosing Illinois as their home,” Mr. Pritzker said. Then why does a new Internal Revenue Service report show an accelerating taxpayer exodus from Illinois and other high-tax states?

The IRS each spring publishes data on the movement of adjusted gross income (AGI) and taxpayers across state lines from year to year. Some Democratic Governors such as Mr. Pritzker claimed that the 2020 Census undercounted their state populations, but the IRS data shows blue states are losing taxpayers and income at an increasing clip....
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The IRS data shows a net 105,000 people left Illinois in 2021, taking with them some $10.9 billion in AGI. That’s up from $8.5 billion in 2020 and $6 billion in 2019. New York’s income loss increased to $24.5 billion in 2021 from $19.5 billion in 2020 and $9 billion in 2019. California lost $29.1 billion in 2021, more than triple what it did in 2019.

By contrast, the lowest tax states added some $100 billion of income during the pandemic. Zero-income-tax Florida gained $39.2 billion—up from $23.7 billion in 2020 and $17.7 billion in 2019. About $9.8 billion of the total arrived from New York, $3.9 billion from Illinois, $3.7 billion from New Jersey and $3.5 billion from California.

Texas was another winner, attracting a net $10.9 billion in 2021, which follows a gain of $6.3 billion in 2020 and $4 billion in 2019. Californians represented more than half of Texas’s income gain in 2021. The Golden State also sent $4.4 billion to Nevada, $2.7 billion to Arizona and $2 billion to Washington. Nevada and Washington don’t tax wages, and Arizona is phasing out its income tax.

Illinois lost income to all of its neighboring states, but the biggest beneficiaries of its taxpayer flight were Florida, Texas, Indiana and Wisconsin. Mr. Pritzker can’t blame lousy weather since it’s not exactly balmy in Kenosha. Billionaire Ken Griffin cited Chicago’s out-of-control crime last year as the reason he moved his hedge fund to Miami.
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Government greed probably outweighs the weather as the reason for leaving the blue states.  But better weather and a friendlier tax climate are good reasons to relocate.

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