The Rust Belt state of Ohio is hemorrhaging jobs. On one hand state officials claim that the state’s tax rate is not a hindrance to attracting companies to invest in the state, while on the other hand these very same officials cut taxes to entice DaimlerChrysler AG to build a plant near Toledo. The state’s tax system cannot be “neutral” when it is obviously too high for additional capital investment. It appears that the state officials realize this since they must provide special tax breaks to stem the flow of jobs out of the state. When will state governments speak the truth and admit that all forms and rates of taxation are a drag on the economy? Probably not until the citizens realize that the dollar lifted from their wallets is not the personal savings of state officials to “invest” as they please.
Source link: http://archive.mises.org/5059/the-rust-belt-v-taxes/