Texas Gov. Rick Perry upset Maryland Gov. Martin O’Malley this week by running radio ads in his state pointing out how O’Malley has made Maryland one of the most heavily taxed states in the country. While Perry was in the area he also visited Beretta, a Maryland-based gun manufacturer.

Gov. Perry certainly has a strong case to make to Beretta that the Lone Star State is a much more fiscally hospitable place to locate or expand their operations. Should Beretta head for the Lone Star State, they wouldn’t be the first prominent gun manufacturer to flee their high-tax, heavily regulated home this year.

Connecticut based gun manufacturer Sturm, Ruger and Co. recently finalized plans to build a new production facility in North Carolina, a move that will create nearly 500 new jobs in the Tar Heel State. Why North Carolina? Why not expand in Connecticut, where Ruger is headquartered? Comparing the tax and regulatory climates of the two states, it’s not hard to see why North Carolina was a more attractive location to expand production.

The 2013 edition of “Freedom in the 50 States: An Index of Personal and Economic Freedom,” ranks North Carolina and Connecticut, 14th and 33rd, respectively, in terms of the regulatory burden imposed by the state. Further, the non-partisan Tax Foundation calculated Connecticut residents face a 12.3% state tax burden while North Carolina residents only face a 9.9% burden. Currently, Connecticut’s top personal income tax rate stands at 6.7%, with a top corporate rate of 9%. The Cost of Government Center calculated Connecticut to have the costliest state government in the country. The latest edition of their annual report notes that North Carolina taxpayers must work until July 11 before they have earned enough income to pay their share of the cost of government. In contrast, Connecticut taxpayers toil nearly a month longer before they earn enough income on August 9.

Earlier this year, Governor McCrory signed historic tax reform legislation that in two years will reduce North Carolina’s personal income tax from 7.75%, down to a flat 5.75%. This 25% percent reduction was the largest state income tax rate cut enacted in the U.S. this year. McCrory and the Republican-controlled North Carolina legislature also cut the corporate income tax rate down to 5% from 6.9%. If revenue targets are met, the corporate rate will fall to 3% by 2017.

The CEO of Sturm, Ruger and Co. made it very clear that North Carolina faced stiff competition from other states, but North Carolina’s new business friendly climate couldn’t be ignored, providing another example of how low-tax states with hospitable regulatory climates are fostering economic expansion, while high tax states like California, New York and Illinois continue to drive employers away. In fact, the average unemployment rate amongst the five states with the worst business tax climate is 7.5, while the five states that score the best on the Tax Foundation's index have a far lower average unemployment rate of 5.9%.

It’s a simple formula: low taxes and fewer regulations attract businesses and spur job growth. North Carolina legislators understand this and this understanding is a big reason why Ruger is creating 473 new jobs in North Carolina and not in New England.