STATES
WITHOUT CAPITAL GAINS TAXES
CREATE
JOBS AT HIGHER RATES
(April 2014) States without capital
gains taxes are creating new jobs at a higher rate than the national average in
the current economic expansion, according to a Policy Foundation analysis of payroll
employment data.
Arkansas taxes income including capital
gains, and has a job creation rate less than half the U.S. average since the
expansion began in June 2009,1 U.S. Bureau of Labor
Statistics data show.
Nine states do not tax income
including capital gains.2 Private economies in those nine states, as a
group,3 created new jobs at a 8.2% rate versus 5.3% for the U.S. between June 2009 and
March 2014, BLS data show.4
Arkansas' job creation rate was 2.5%
in the same period. Only one of the nine states (New Hampshire) had a lower job
creation rate, as the following chart shows:
| State | June 2009 | March 2014 | Growth Rate |
| Texas | 10,283,700 | 11,416,600 | 11.0% |
| Florida | 7,221,100 | 7,742,900 | 7.2% |
| Tennessee | 2,605,700 | 2,785,500 | 6.9% |
| Washington | 2,859,100 | 3,029,700 | 6.0% |
| Nevada | 1,144,100 | 1,210,100 | 5.7% |
| United States | 130,944,000 | 137,928,000 | 5.3% |
| Alaska | 319,600 | 335,600 | 5.0% |
| South Dakota | 403,400 | 419,600 | 4.0% |
| Wyoming | 284,900 | 294,600 | 3.4% |
| Arkansas | 1,161,300 | 1,189,800 | 2.5% |
| New Hampshire | 635,900 | 638,000 | 0.3% |
--Greg Kaza
1 National Bureau of Economic Research business
cycle chronology
2 Federation of State Tax
Administrators. Also see Kyle Pomerleau, "The High Burden of State and Federal
Capital Gains Taxes," Heritage Foundation, Feb. 20, 2013
3 Total nine states that do not tax capital
gains: (June 2009) 25,757,500 (March 2014) 27,872,600
4 Private economies in the nine states added 2,115,100 new
jobs, more than 30 percent of new jobs in the U.S. (6,984,000).