Friday, June 12, 2015

Thanks to Gov. Mike Pence...

...of Indiana, I now know that the Hoosier State's tax burden on business is the lowest in the Midwest and seventh lowest in the entire nation. (I was wondering where I could find that information; Pence links to a study from Anderson Economic Group.) That has to be good news, right?

My home state of Illinois, for example, ranks behind two of its immediate neighbors and ahead of a third:

No. 7 Indiana
No. 20 Iowa
No. 33 Illinois
No. 35 Wisconsin

But, I have to ask, does this really matter? I mean, Illinois is a veritable economic powerhouse compared to Indiana:

List of U.S. states by GDP, 2015

No. 5, Illinois, $742 billion
No. 16, Indiana, $328 billion
No. 20, Wisconsin, $293 billion
No. 30, Iowa, $174 billion

Even if you adjust for Illinois' higher population, it's still much greater:

List of U.S. states by GDP per capita, 2012

No. 16, Illinois
No. 23, Iowa
No. 29, Wisconsin
No. 31, Indiana

So the relatively high business tax burden here must not be chasing that many companies out of Illinois. And it's not preventing us from having higher median household incomes either:

List of U.S. states by income, 2014

No. 18, Illinois
No. 21, Wisconsin
No. 24, Iowa
No. 31, Indiana

So who, besides Gov. Mike Pence, really cares about this statistic? It doesn't seem to be helping the economy of Indiana much, does it? In fact, I don't see how it's really relevant at all.

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