History is repeating itself.
Last year, Mississippi launched a full phase-out of its income tax while Maryland imposed the largest tax hike in its history. The results were predictable: states that lower taxes attract growth, while those that raise them drive people and investment away.
Now Missouri and Washington are moving in opposite directions—and the contrast could not be clearer.
Missouri is advancing a bold plan to eliminate its personal income tax entirely. With the rate already cut to 4.7 percentand a full capital gains exemption in place, Governor Mike Kehoe and state lawmakers are pushing a constitutional amendment that would appear on the 2026 ballot, gradually reducing the tax rate to zero over five years while shifting to a broader consumption-based revenue system if needed.
In short, Missouri is choosing a future where workers and entrepreneurs keep more of what they earn.
Washington is heading the opposite direction. Despite a state constitution that classifies income as property that must be taxed uniformly—and despite voters repeatedly rejecting income taxes—lawmakers are attempting to impose a 9.9 percent “millionaire’s tax.”
This move overrides both constitutional precedent and the will of voters who rejected income-tax proposals as recently as 2024.
The economic evidence behind Missouri’s approach is overwhelming.
Today nine states do not levy a broad personal income tax, including Texas, Florida, Tennessee, and Wyoming. These states consistently rank among the nation’s fastest-growing economies and most popular destinations for Americans relocating across state lines.
Migration trends illustrate the point clearly. In recent years Florida and Texas alone attracted hundreds of thousands of new residents through domestic migration, reflecting a broader pattern of Americans leaving higher-tax states for lower-tax alternatives.
Research increasingly confirms the economic advantages of this model. A 2026 analysis by the White House Council of Economic Advisers found that eliminating a state income tax could:
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Increase a state’s GDP by 1–1.6 percent
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Boost new business formation by 16–19 percent
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Raise average wages by about $4,000
The report also found that states without income taxes frequently rank among the top states for both economic growth and inbound migration.
The reason is simple: lower taxes attract talent, investment, and entrepreneurship. When states reduce the penalty on work and investment, they create a virtuous cycle—more businesses, more jobs, higher wages, and stronger economic growth.
The opposite is also true.
States with less competitive tax systems often experience higher levels of out-migration, as residents and businesses relocate to jurisdictions where economic opportunity is greater and tax burdens are lower.
This is the fundamental choice facing policymakers.
Missouri is choosing growth.
Washington is choosing higher taxes.
Over the next decade, Missouri’s strategy will likely bring more jobs, more investment, and more residents seeking opportunity. Washington’s approach risks driving exactly the opposite outcome.
The scoreboard will tell the story.
States that reward success build thriving economies. States that punish it do not.