Now that he has signed his $25.1 million contract with the Houston Rockets, former New York Knicks sensation Jeremy Lin will no doubt be grateful for the 0 percent state and city income tax he will enjoy in the state of Texas.
In New York City, Lin paid the top state income tax rate of 8.82 percent, in addition to a New York City income tax of 3.876 percent. By moving to Texas, Lin will save over $1 million per year, with total savings of $3.12 million over the life of his new contract.
Lin is not the only New Yorker who will benefit from moving to a state with a lower tax burden this year: Americans for Tax Reform notes that more and more job creators and families are escaping the crushing taxes of New York by moving to states like Texas. As the American Legislative Exchange Council’s Rich States, Poor States shows:
- In terms of gross state product growth, the nine states without a personal income tax outperformed the nine states with the highest personal income tax by 39 percent over the past decade.
- The nine states without a personal income tax have outperformed the U.S. average by over 25 percent over the past decade.
- Average population growth among the nine no-tax states was 148 percent higher than in the nine high tax states over the past decade.