Mostly, when the tax paying folks leave, you lose tax revenue, Mostly.
For every small business of 100 people that gives up and leaves the state....it’s a true significant loss that cannot be made up. That’s business-related taxes, property taxes, and the income taxes of the 100 people, layered on top of the small business itself.
So you figure that a hundred such businesses easily leave each year as a minimum. Toss in a few larger businesses, and small store fronts that just give up. At the end of the day...you just can’t make up for the losses.