With Maryland inflicting upon itself the largest tax increase in state history — we discussed it in this post — The Examiner takes a look at the role of taxation in the economies of Maryland versus Virginia. The editorial, “Rich states grow faster by taxing less,” draws on the new book published by the American Legislative Exchange Council, “Rich States, Poor States,” written by Arthur Laffer and Stephen Moore.
Laffer and Moore also explain why a record 8 million Americans — more than 1,000 per day — packed up all their worldly possessions in 2006 and moved to high-growth states, which more often than not are those with the lowest tax burdens.
Virginia was ranked an outstanding sixth in the nation for future economic growth, placing among the top 10 states in five of the 16 variables measuring competitiveness. No wonder 162,653 more people moved into the commonwealth than out during the past decade, according to U.S. Census Bureau data.
The greatest challenge for Virginia lawmakers will be to resist seeking new or increased taxes. In contrast, Maryland’s future economic outlook is much bleaker than Virginia’s; it was ranked 32nd, putting it in the bottom half with the “has been” states.
In CNBC’s “America’s Top States for Business” rankings last year, Virginia ranked No.1 and Maryland came in 27th. We won’t be surprised to see Maryland slip the next time CNBC does these comparisons.
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