While the nation turns its attention to the presidential candidates in the Florida Republican presidential primary tonight, maybe it is the presidential candidates who should be turning to Florida for how to re-ignite the nation’s economic engine and restore growth.
As we document over at How Money Walks, Florida has achieved dramatic gains in wealth over the last two decades amounting to $127 billion annually. This dramatic explosion in economic activity and wealth creation did not just happen because rich retirees moved to the Sunshine state to enjoy the weather and golf.
Rather, it was the state’s implementation of a specific set of conservative policies, particularly on the tax side, that have enabled Florida’s flourishing.
Florida residents are blessed with minimal tax burdens, including among others no state income tax or estate tax. As the ironclad economic rule tells us, “if you tax something more you get less of it.” Conversely, tax something less and you get more of it. If you want sustainable capital formation, leaving more money in the hands of those who earn it, and removing the immoral double taxation inherent to the estate tax are good places to start.
As monetary capital flows where it is treated best, so too does human capital. To that end, Florida has had the second-highest net domestic migration of any state from 2004-2013, second only to economic powerhouse Texas.
Under the leadership of businessman and political outsider Gov. Rick Scott, Florida’s pro-commerce and thus pro-human capital policies have continued. Of recent note, Gov. Scott was able to pass a series of tax cuts including eliminating the tax on manufacturing equipment altogether and substantially reducing communications taxes, the latter of which saved taxpayers almost $230 million. The state also cut sales taxes on a number of products estimated to save citizens another $130 million.
These pro-growth policies provide a model for a robust American economy writ large, a critical objective of the entire Republican field.
We have heard a lot this election cycle about bringing jobs and investment back to America. Florida has signaled exactly how to entice companies not only to not leave the country through tax inversions but to flood back to our shores, through treating capital and entrepreneurial individuals kindly.
From Governors Bush to Scott, the state’s pro-growth executives ought to be emulated by those vying for the Florida Republican vote. Floridians ought to weigh heavily the candidates’ positions on corporate taxes, capital gains, income taxes and simplifying and creating real fairness in the overall tax code itself.
The chair of Florida’s House Finance and Tax Committee, Rep. Matt Gaetz has been quoted as saying
In my committee, no tax is safe. It is the goal of the House of Representatives to find even more ways to decrease the tax burden on Florida’s families.
From Washington, D.C. to Tallahassee, FL, the state should never be a “safe space” for taxes.
Imagine if those in our federal government, led by the commander-in-chief had this type of attitude. All Republicans and indeed all political leaders on a bipartisan basis ought to adapt it. A pro-growth, pro-tax reform agenda is a pro-American agenda.
Its benefits will make the whole nation a sunshine state for wealth. No matter who wins tonight, lets hope the Republican nominee shines the light on Florida!