Sunday, March 3, 2019
Amazon’s Hard Bargain Extends Far Beyond New York
Since 2010 Amazon has leveraged its huge impact on local economies to influence regional politics. When Texas tried to make Amazon pay $270 million in back taxes they left the state for 2 years till all the tax charges were waived. Amazon has used similar tactics in Seattle, South Carolina, and New York to avoid local and state taxation. Through the sheer size of its financial impact Amazon can leverage its position for greater tax credits and benefits. When New York tried to work with Amazon to create new jobs and locations in the state the company didn't hire any local employees or lobbyists but instead brought outsiders to create the deal. So far Amazon has leveraged its position for more than $2.4 billion in taxpayer subsidies. Amazon employees a huge number of lobbyists to fight against any attempts by localities to impose sales taxes or remove the tax breaks the company receives and has been effective so far in imposing its will on regulators.
https://www.nytimes.com/2019/03/03/technology/amazon-new-york-politics-jobs.html
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So often politicians see the benefit of more jobs and more tax revenues from an Amazon opening up but fail to see the costs. So often in cases of "corporate poaching" the locality that provides incentives via tax breaks or abatements find that they are losing out on substantial revenues that could otherwise help their localities to grow.
I was reading an article recently that said tax breaks and incentives to corporations from American localities is estimated around $80 billion. That's a lot of money for tax payers, who so often see none of the benefits, to come up with. If you're going to hand over that much money there should at least be a clause to hire local workers or something. It's truly amazing what politicians are willing to spend on this stuff when they'd be better off filling in pot holes, paying down debt or supporting local businesses and entrepreneurship.
https://www.washingtonpost.com/news/made-by-history/wp/2018/05/08/its-time-for-cities-to-stop-giving-tax-breaks-to-corporations/?noredirect=on&utm_term=.0973fba2a20d (this is the article I read)
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