A NYC business owner says he moved his company to Florida because of regulations
Fox Business’ Madison Alworth joins ‘Varney & Co.’ reporting on new positions for highly regulated states as businesses flee high-tax states, experts warn that tighter regulations are holding back economic growth.
The widening gap between highly regulated regions and those with lighter regulations is increasingly widening where businesses choose to operate, as compliance costs and administrative barriers weigh on growth.
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A U-Haul truck parked on the side of the road during a move in California (Smith Collection/Gado/Getty Images)
FOX Business’ Madison Alworth joined FOX Business’ Stuart Varney on “Varney & Co.” reporting on how regulatory burdens impact economic decisions across the country.
Recent data from the Cato Institute highlights how states like New Jersey, California and New York rank among the most restrictive, while states in the Midwest and Plains offer business-friendly environments. That divide is becoming more pronounced as companies gain flexibility to relocate jobs.
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For some business owners, the pressure is immediate. Outer Realm CEO Dhara Patel, who previously owned a real estate tour company in New York City, explained the number of compliance requirements.
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“I swear, sometimes I can’t sleep because I’m like… Did I do this? Did I submit these papers?… It’s worrying when they come to comply with new laws, the new annual report they need,” said Patel.
He eventually moved his business to Florida, citing both regulatory difficulties and tax savings as important factors.
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“New York made it more difficult, the number of reports you have to file, new paperwork and everything like that,” she said.
Economists say the broader impact extends beyond individual firms. Regulation can act as an additional cost to businesses, limiting the time and resources that could be spent on expansion.
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“Regulations are like taxes. They are costs that businesses have to pay to do business in the country… More regulation means less growth,” said expert John Lonski.
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He added that higher regulatory burdens tend to be associated with slower economic growth, as businesses and workers gravitate to less restrictive areas.
The distinction emphasizes how areas of control expand when businesses choose to operate and grow.
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