NC's High Taxes Scaring Off Big Business

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Despite all the whining from the government haters on the right, North Carolina continues to attract investments from growing businesses. It seems like every week brings announcements of relocations and expansions, like this one reported today.

Merck & Co. plans to invest about $100 million to expand its vaccine manufacturing facility in Durham if approved by county commissioners, the governor's office announced Thursday. The planned 115,000-square-foot expansion, which would create another 50 to 60 jobs, includes a sterile processing facility, testing labs and packaging areas, according to Gov. Mike Easley's office. The pharmaceutical giant began constructing the facility in 2004, and expects it to be completed next year.

"Merck's expansion in Durham further strengthens North Carolina's leadership position in the life sciences industry," Easley said.

If all you read was the over-heated rhetoric from the John Locke Foundation, you'd think North Carolina was collapsing under the weight of onerous taxation, scaring responsible businesses away like flies. As is the case with most of what the free-market fundamentalists have to say, that's just not true.


job losses vs growth

Over the past 10 years parts of this state have been destroyed by bills passed in large part by Republicans, such as NAFTA and CAFTA. At the same time, other areas have seen unprecadented growth because of Democratic policies. Its pretty clear that tax levels are much less important than quality of life and infrastructure. If that wasnt true then all these companies would be moving to Mexico or somewhere instead of moving to RTP and other areas.

"Keep the Faith"

How Highly We're Taxed, and How Well We Live

Here's how we rank among Southeastern States in terms of both corporate and individual taxes. As a guide to how those States also rank in standard of living I've included those figures at the bottom.

When I put this together I had no idea how the figures would turn out.

We can take some satisfaction in that North Carolina doesn't have the highest tax burden in the Southeast; actually we're third behind Louisiana and West Virginia in both our individual and corporate tax burden.

However, we can't take much satisfaction in that because the two states that exceed North Carolina in total taxation are also are mired at the bottom in terms of their standard of living.

One other interesting statistic is that the three States with the smallest individual tax burden are also the top three States in terms of their standard of living.

North Carolina seems to be something of a mild anomaly in the South. Our individual and corporate tax burden ranks in the top three while our standard of living ranks in the top four. Maybe our taxes are just spent more wisely?

I'm sure there are many other factors besides taxes that affect a State's standard of living - factors like weather, topography, natural resources, education and infrastructure. However, even if these comparisons are crude, they're also worth noting.

If someone could offer other metrics that dispute these results I'd love to see their data and read their argument.

State Corporate Income Taxes
According to The Tax Foundation

9.0% West Virginia
8.0% Louisiana
6.9% North Carolina
6.5% Alabama
6.0% Georgia
6.0% Virginia
5.5% Florida
5.0% Mississippi
5.0% South Carolina

Average Individual Tax Burden (1)

10.5% West Virginia
10.4% Louisiana
10.0% North Carolina
10.0% Mississippi
9.8% Georgia
9.7% South Carolina
9.7% Virginia
9.2% Florida
8.7% Alabama

(1) That burden reflects what residents pay in state and local income taxes, property taxes, sales taxes, luxury taxes and fuel taxes, among others.

Standard of Living By State (2)

$69 Virginia
$68 Georgia
$60 Alabama
$59 North Carolina
$59 South Carolina
$58 Florida
$52 Louisiana
$51 Mississippi
$50 West Virginia

(2) the monetary standard of living by state, as calculated by median income for a family of four divided by the Accra's cost of living index.

I'm 56 years old. I moved to North Carolina five years ago. The previous twenty-five years I spent as a resident of Chicago's north shore and before that Wisconsin, Utah and California. I live in Moore County. My Congressman is Howard Coble, my State Sen

Great information George

There are also factors other than our tax rate that will scare away industry. Many of the things that are required to attract industry/business cost money. No taxes, no infrastructure. I'm currently at a stage where I'm tired of hearing the Republicans I know complain about taxes. I almost never hear a Republican talk about viable solutions. I guess it's easier to complain.

Robin Hayes lied. Nobody died, but thousands of folks lost their jobs.

Vote Democratic! The ass you save may be your own.

Good stuff

Thanks for pulling this.

The "quality of life" stuff is a little puzzling. Most of my focus has been NC vs SC, where the indicators I've tracked (infant mortality, teacher pay, graduation rates, murder rate, etc.) generally put SC pretty far behind.

Quality of Life

I'm also think that South Carolina is not as pleasant a place to live as North Carolina, and the indicators you cite above probably do argue in North Carolina's favor.

However, there is a difference between "quality of life" and and "standard of living." Standard of living only takes two things into consideration, how much money do you make, and how much does it cost to live where you live.

The State with the highest standard of living is Minnesota, but I don't see a lot of people eager to move there. Hawaii has the third highest individual tax rate in the nation, and is dead last among the States in its standard of living, but I still occasionally dream of what it would be like to live there.

There are a host of factors that would incline a person to prefer to live in one place as opposed to another, but in fairness few of those factors relate as directly to government policy as the tax rate.

I'm 56 years old. I moved to North Carolina five years ago. The previous twenty-five years I spent as a resident of Chicago's north shore and before that Wisconsin, Utah and California. I live in Moore County. My Congressman is Howard Coble, my State Sen

Point taken

I'm a little addled this morning, running too fast and already behind.

Check your inbox?

Fun with numbers.

A slightly different take on total taxes paid.

Mississippi $4,046
West Virginia $4,248
Louisiana $4,587
Alabama $4,694
South Carolina $4,767
Kentucky $4,833
North Carolina $5,306
Tennessee $5,323
Georgia $5,723
Texas $5,841
Florida $6,290
Virginia $6,792

Here, Virginia, Florida, and Georgia are among the HIGHEST tax payers, as opposed to the lowest on your list.

The "standard of living" might not be a good indicator because it takes into account what you can buy, which depends on what percent of the population live in urban areas I would assume. For instance, North Carolina might have more urban population than Georgia or South Carolina, which means goods would be cheaper there on average.

Or, another possibility is that it is HAS to be cheaper to buy goods where people make less money.
Average yearly income:
North Carolina 31,077
South Carolina 28,173
Louisiana 27,877
West Virginia 26,887
Mississippi 25,197

Or, that state and corporate taxes are lower for "welfare states", but their standard of living is higher because WE make up for it.
Dollars received per dollar taxed:

West Virginia $ 1.83
Alabama $1.71
Mississippi $ 1.77
Virginia $ 1.66
Kentucky $ 1.45
Louisiana $ 1.45
South Carolina $ 1.38
Tennessee $ 1.30
North Carolina$ 1.10
Florida $ 1.02
Georgia $ 0.96
Texas $ 0.94

So, for instance, West Virginia, Mississippi, and Louisiana have a "higher standard of living" on your table than North Carolina, yet that could be because they are subsidized by other states. BTW, North Carolina used to be at about $1 - even - but has inched up since the Bush years.

I think the only correlation between taxes and quality of life is that those who see taxes as "okay" are more likely to fund things like child health services, medicaid, and clinics. Even that doesn't hold true, because I happen to know that Iowa, which stands about where North Carolina does on the above table, is one of the only states that mandates and PAYS to have every baby tested at birth for every "testable" genetic diseases.

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.


With the sweaters that Robert wears to nationally televised events, I believe the correct term is "numberjack".

Boys, boys

I can only afford to replace one keyboard a month and December's happened last night and this morning reading A's thread at Kos. Lordy, there are some funny comments on that thread that is STILL on the rec list, btw.

Robin Hayes lied. Nobody died, but thousands of folks lost their jobs.

Vote Democratic! The ass you save may be your own.



Vote Democratic! The ass you save may be your own.

Since you axed

That's BlueNC, the goring ox, on the right.