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Utah tops ALEC’s list of states with the best economic outlook, again

By Kyle Dunphey - Utah News Dispatch | Apr 10, 2024

Spenser Heaps, Utah News Dispatch

The Capitol is pictured with downtown Salt Lake City behind it on Friday, Jan. 26, 2024.

For 17 years, the American Legislative Exchange Council has compiled a report of states with the best economic outlook — and for 17 years, Utah has emerged at the top of the list.

On Tuesday, the Beehive State again emerged as the top state in the report “Rich States, Poor States,” which analyzes 15 economic factors including whether the state has an inheritance tax or minimum wage, right-to-work policies, cumulative GDP growth and employment growth. Utah was ranked first in all five aforementioned categories.

In “recently legislated tax changes,” Utah ranked seventh after lawmakers passed a bill this past legislative session lowering the state’s income tax rate from 4.65% to 4.55%. The state also ranked seventh for “remaining tax burden.”

For marginal personal income tax rate, Utah ranked 17th — for marginal corporate income tax rate, the report put Utah at 11th. The state’s lowest ranking, 38th, was in sales tax burden.

The American Legislative Exchange Council, or ALEC, is a national policy organization that promotes conservative politics and free-market governance. States with lower taxes and spending tend to rank the highest — Republican states like Idaho, Indiana, Texas and South Dakota dominated the most recent report. The bottom 10 states tend to lean Democrat, including Vermont, New York, Illinois and California.

Jonathan Williams, ALEC’s chief economist and executive vice president of policy, said Utah’s fiscal responsibility and economic policies make it an “incredible model for the nation.”

“With the gridlock currently plaguing our federal government in Washington, Americans should look to successful states like Utah for commonsense policy solutions,” Williams said in a news release.

Senate President Stuart Adams, R-Layton, applauded the legislature’s work and “forward-thinking mindset,” which he said builds on Utah’s “pioneer ancestors.”

“It’s no mistake our economy has remained on top for the past 17 years. Utah is rich with opportunity. A Utah-first mindset enables businesses and individuals to continue to flock to our state to benefit from the financial freedom lower taxes provide and to enjoy the high quality of life our state policies have helped cultivate,” Adams said in a statement.

And House Speaker Mike Schultz, R-Hooper, said the state’s economic strength is a result of “thoughtful and intentional planning and budgeting.”

“In Utah, we put our people first. A strong economy, low taxes, and fiscal prudence will help keep life affordable and allow Utahns to thrive in all areas of life,” Schultz said.

While ALEC markets itself as a group that promotes a free-market and small government, its policies — which have included things like mandatory minimums and stand your ground laws — are often criticized. The group has also been called “shadowy” and accused of writing bills for state lawmakers.

In November, nonprofit Citizens for Responsibility and Ethics in Washington wrote that ALEC’s “indifference to democracy and racial justice threaten to deepen divisions and disparities in our society.”

Utah News Dispatch is a nonprofit, nonpartisan news source covering government, policy and the issues most impacting the lives of Utahns.


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