Gov. Rick Scott is well into his second term in office. The Republican focused his inauguration address on jobs and tax reform. In that speech, he claimed this:
"Over the last 20 years, millions of people have escaped from states with climbing tax rates to move to states with lower taxes. For starters, estimates say individuals who escaped these high tax states have taken with them around $2 trillion of adjusted gross income. They’re voting with their feet."
PolitiFact Florida examined the claim for its truthfulness, and reporter Joshua Gillin said it rates MOSTLY FALSE. Gillin said the numbers don’t paint the full picture.
“Even economists who support this theory of all this money going to other states say, ‘You have to keep in mind adjusted gross income on their tax returns doesn't necessarily mean that they're taking that money to the new state,’ ” Gillin said.
The figures come from a book, How Money Walks: How $2 Trillion Moved Between the States, and Why It Matters. Author Travis Brown argues that it appears there is a correlation between state personal income tax rates and income migration.
But a number of experts disagree. One pointed out that it’s not clear if the $2 trillion figure represents all the money moving out of high tax states into low tax states or if it’s just all the money that didn’t stay in the same state over a 15-year period.
There are also many ways to interpret that number. The figure doesn’t account for people who move to new states but continue to work in old states. It also leaves off people who move because they are laid off.
Finally, there is research that shows of the people who move between states, few of them cited state taxes as a reason. Because of those facts, PolitiFact rated the claim MOSTLY FALSE.
SOURCES: $2 TRILLION WORTH OF INCOME MOVING TO ESCAPE HIGH TAXES
- PolitiFact's rating
- Audio of Gov. Rick Scott’s inaugural address, Jan. 6, 2015
- New York Times, "The Sun Belt and the Frost Belt," Dec. 29, 1981
- Empire Center, "Empire State Exodus," Oct. 27, 2009
- Center on Budget and Policy Priorities, "Tax Flight Is a Myth," Aug. 4, 2011
- Stanford University, "Millionaire Migration in California: The Impact of Top Tax Rates," 2012
- Tax Foundation, "Annual State-Local Tax Burden Ranking (2010) - New York Citizens Pay the Most, Alaska the Least," Oct. 23, 2012
- New York Times, "The Myth of the Rich Who Flee From Taxes," Feb. 15, 2013
- YouTube video, "NTU Interview with ‘How Money Walks’ Author Travis Brown," Feb, 19, 2013
- Tax Foundation, "Is Tax Migration a Myth?," Feb. 26, 2013
- PolitiFact Florida, "Will Weatherford says 1,000 people a day move to Florida because of freedom," April 2, 2013
- U.S. News & World Report, "Every Day Is Tax Day," April 15, 2013
- WatchdogWire.com, "Travis H. Brown on how money walks in or out of your state," April 25, 2013
- Tax Foundation, "Monday Map: Migration of Personal Income," Aug. 19, 2013
- Gallup, "Half in Illinois and Connecticut Want to Move Elsewhere," 2014
- Travis H. Brown, "How Money Walks," published Jan. 14, 2013
- PolitiFact Florida, "Florida surpassed New York in population, Bill Nelson says," April 14, 2014
- Washington Post GovBeat blog, "People don’t vote with their feet when it comes to taxes, report finds," May 8, 2014
- Center on Budget and Policy Priorities, "State Taxes Have a Negligible Impact on Americans' Interstate Moves," May 21, 2014
- Bloomberg, "Why Have Americans Stopped Moving?," May 28, 2014
- Deseret News, "Do lower taxes actually convince people to move?," May 30, 2014
- National Review, "The New War Between the States," May 30, 2014
- Center on Budget and Policy Priorities, "State ‘Income Migration’ Claims Are Deeply Flawed," Oct. 20, 2014
- Medium.com, "Methodological Notes and FAQ for ‘Which States Win Migration? Part I’," Nov. 17, 2014
- Tampa Bay Times, "Florida overtakes New York as third most populous state," Dec. 23, 2014
- Tampa Bay Buzz blog, "Scott's address will contrast Florida with high-tax northern states," Jan. 5, 2015
- Tampa Bay Times, "Gov. Rick Scott's New York state of mind," Jan. 5, 2015
- HowMoneyWalks.com, "IRS Tax Migration," accessed Jan. 6-8, 2015
- Interview with Jeri Bustamante, Scott spokesperson, Jan. 6, 2015
- Interview with John Tupps, Scott spokesperson, Jan. 6, 2015
- Interview with Michael Mazerov, Center on Budget and Policy Priorities senior fellow, Jan. 7, 2015
- Interview with Cristobal Young, Stanford University sociology professor, Jan. 8, 2015