SandBoxBlogs: Town Hall "ALEC’s Rich States, Poor States"

Chris Edwards:
"The American Legislative Exchange Council (ALEC) released the fifth edition of its “Rich States, Poor States” report yesterday. For fiscal wonks the report is a fun read, as it is chock full of tax and economic comparisons between the 50 states.

The first part of the report is a “Supply Side 101” lesson on the advantages of low marginal tax rates and the mobility of labor and capital. One point that policymakers often overlook is that a high tax rate on one tax base tends to shrink not just that tax base, but other tax bases as well. Thus, high income tax rates shrink reported incomes, and in turn that shrinks both income and payroll tax bases. Similarly, high corporate income tax rates shrink the corporate tax base and the individual and payroll tax bases as corporate investment, hiring, and wage growth are reduced...."  (Read more?  Click title)

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