For the 19th consecutive year, Utah has secured the number one spot for Economic Outlook in the latest Rich States, Poor States report. Published annually by the American Legislative Exchange Council (ALEC), the 2026 edition of the State Economic Competitiveness Index highlights Utah’s consistent dominance in fiscal policy and growth potential.
The ALEC-Laffer Ranking
The report, co-authored by Dr. Arthur B. Laffer, Stephen Moore, and Jonathan Williams, evaluates states based on 15 economic policy variables. Since its inception in 2007, it has served as a benchmark for lawmakers to measure how policy choices impact competitiveness.
Key findings from the 19th edition include:
- Tax Structure Matters: Eight of the top 10 states feature either a flat personal income tax or no income tax at all.
- Economic Freedom: States prioritizing limited government and free-market solutions are currently driving the nation’s economic recovery.
- Migration Trends: Light-touch regulatory environments and low taxes are successfully attracting families and businesses away from high-tax states.
Why Utah Leads the Pack
Utah’s nearly two-decade reign is attributed to a proactive legislative approach focused on long-term stability and taxpayer relief. Notable reforms include:
- Flat Tax Adoption: Implementing a predictable, flat personal income tax rate.
- Pension Reform: Transitioning an endangered pension system into a sustainable model.
- Property Tax Innovation: Developing creative solutions to manage property tax burdens.
As ALEC President Jonathan Williams noted, Utah’s commitment to “economic freedom” continues to set the standard for attracting opportunity, while states at the bottom of the rankings continue to see a steady exodus of residents.