The competition between states continues as millions of Americans migrate from high-tax states to lower-tax states and potentially lower-cost-of-living states. This is according to a recent report by the nonpartisan Tax Foundation, which reviewed publicly available information on tax filers.
By using public data from the IRS, the report highlights the detrimental impact of excessive taxes. The research tracks activity from 2022 to 20223.
The research indicates that 27 states saw population gains, led by the following states:
- Texas (+56,473)
- Florida (+55,349)
- North Carolina (+39,118)
- South Carolina (+29,214)
- Tennessee (+24,104)
- Arizona (+17,316)
- Georgia (+14,671)
- Colorado (+11,341)
Texas, Florida, and Tennessee assess no state income tax.
On a per capita basis, Florida led with $184,771 in adjusted gross income per new resident.
The states that have seen population decline are:
- California (-100,397)
- New York (-71,987)
- Illinois (-28,609)
- New Jersey (-19,370)
- Massachusetts (-15,378)
- Maryland (-13,628)
- Pennsylvania (-12,095)
The 10 counties with the largest net losses in tax filers to out-of-state locations were all in California or New York. These are as follows:
- Los Angeles County, CA (-17,496);
- Queens County, NY (-17,109);
- Bronx County, NY (-16,319);
- Orange County, CA (-11,618);
- Suffolk County, NY (-10,434);
- San Diego County, CA (-9,401);
- Nassau County, NY (-9,130);
- Riverside County, CA (-8,968);
- San Bernardino County, CA (-8,462);
- Kings County, NY (-6,924)
Two Florida counties received the biggest boost in adjusted gross income, with Palm Beach County (+$3 billion) and Collier County [Naples] (+$2.25 billion) experiencing significant wealth migration.
The following counties experienced the largest amount of wealth flight: Cook County, IL (-$4.35 billion), and California counties, Los Angeles County (-$4.23 billion) and Santa Clara County (-$2.8 billion).
All of this has an important impact on state finances as population leaves, including the affluent; it becomes harder to generate tax revenue to pay for services. Meanwhile, numerous states are counterintuitively seeking to raise taxes, which will obviously drive more residents to flee them.