Why State Taxes Matter

Published February 7, 2023

States that require the rich to pay more in taxes than other states run the risk of having high earners leave in search of lower-tax environments. When high earners leave, states lose out on tax revenue and either need to raise taxes on everyone else or cut social spending programs.

Discussion Questions:

1. Is it ever fair to tax some people more than others? 
2. Are high-income earners wrong to leave California because of high taxes?

Additional Resources:

• Read “Killing the Goose That Lays the Golden Egg,” by Joshua D. Rauh and Jillian Ludwig. Available here.
• Watch “Three Ways to Keep Businesses and People in California,” with Lee Ohanian on PolicyEd. Available here.
• Read “Myths of Economic Inequality,” by David Henderson. Available here.