The U-Haul Index is a study of where Americans are moving and how much they’re paying to move there. For example, renting a 20-foot truck from San Francisco to San Antonio costs an estimated $1,693, but going in the opposite direction costs only $983 for the same truck. In other words, there’s much more demand heading from San Francisco than to San Francisco.
Since first being publicized by economist Mark Perry, the U-Haul Index has become one of the best indicators of a state’s economic health and attractiveness to business. This year, the numbers continue to look promising for continuing growth in Texas:
According to the Tax Foundation, “Tax Freedom Day” arrives earlier in Texas than it does in California, due to its zero individual and corporate income tax and a lower sales tax. Put together, Texas’ state and local tax burden is less than eight percent of income, well below the national average of nearly 10 percent, while California’s is almost 12 percent.
This enormous disparity puts California the 48th out of the 50 states in the foundation’s overall business tax climate index, while Texas ranks ninth.
It isn’t all about taxes, however. Its regulatory environment and yawning fiscal deficits are chasing companies away to more favorable locales. Part is the state’s determined efforts to increase still further its tax burden on high income earners — now an astounding 13 percent — along with its implementation of policies favored by the Obama administration in Washington.