Who cares where it comes from. Tax payers are out 5 billion does it matter how?
The city gave away $5 billion in tax breaks to ensure billions more in tax revenues. The deal was tax-positive. What those extra billions get spent on is up to us.
The Amazon thing is a massive red herring. Yes, it’s distasteful. But it’s also tiny. Giant political deals are being struck in Albany right now—Amazon is a distraction.
i'd like to see evidence of that. Amazon could've have still chosen new york for the HQ building. There's plenty of incentives already.
Therefore, only if there's reason to believe that amazon won't have built it in NY would the 5 billion tax break have been worth it.
All these corporations do with their profits and tax-incentives is hoard them overseas and spend them on stock buy-backs.
https://www.barrons.com/articles/2018-record-stock-buybacks-...
You do realize NYC is not collecting less taxes because Amazon came? If Amazon goes to another city, they collect 0. if Amazon gets a tax break, they collect 0. now you could argue that Amazon provides some sort of extra burden on city resources, though they would also collect more taxes from the employees and other services rendered.
You pick your preferred baseline, fair enough. But since we're talking about a discriminatory tax break here, it's perfectly reasonable to choose as baseline a world without discrimination. And in that comparison, NY de facto pays the 5 billion or whatever it is. Of course, this is also choosing an ultimately arbitrary baseline for comparison.
You can ping pong this discussion indefinitely because there is no absolute, divine baseline to compare against.
NYC is not PAYING 5 billion dollars. they are simply not taxing it, therefor you can not say 'what else could they have used this money on instead'.
Its like me hosting a website for many charging 100$, and one person comes to me and says they will pay me 0$ but do other stuff, but otherwise they will not use my services. I can not say 'gee, if I charged them 100$ I could do these other things with the money', because I am not paying them 100$ to use my site.
Argue as much as you want about corporate motives (and I agree with you on incentives being not ideal, even though Amazon doesn’t “do” profits), it has no bearing on how tax write-offs work.
Short of implementing a federal law against it, there is no scenario where cities were not going to compete to lure Amazon. Fortunately no such federal law exists, which enables cities great leeway to compete for both citizens and businesses, through tax and regulatory structure, incentives, zoning laws, et al.
If I'm Detroit and I want to rebuild my collaped city, one great way to do that is to forgo some purely theoretical new near-term taxes - which you're not actually getting anyway because businesses don't want to move there - and offer up incentives such as tax breaks for businesses to go there instead of somewhere else. For a place like Detroit, that also means jobs, luring population to rebuild the tax base, rebuilding the housing stock, rebuilding the small business base that services that population, and so on.
i would say that's unfortunate rather than fortunate.
Cities competing for businesses is a net loss to the tax payer. If a business is to build a new HQ or invest, they should do it on the merits of their business needs and general condition applicable to all businesses.
If a particular company gets an unfairly good treatment, then it's very anti-competitive for other businesses. Why should tax payer shoulder any burden for a private business specifically, rather than building general infrastructure that benefits all businesses?
> If I'm Detroit and I want to rebuild my collaped city ... offer up incentives such as tax breaks for businesses
that would be great - if it was a general tax break, rather than a tax break targeted at specific companies that others can't gain access to.
Sure, if the taxpayer exists as an abstract concept. Not when the Taxpayer is a sandwich seller near the new company’s office. Or when the Taxpayer is given a new job at the company. Or when the Taxpayer is the family that can now rent out its mother in-law unit more easily
these are not tax payers - these a private individuals.
Why should the sandwich seller from the bronx not be able to benefit from the city's policies, where as the sandwich seller from jersey does under these policies?
The EU does this better. EU courts can deem a tax break state aid and require the company to pay back taxes. This disincentives states competing against each other on tax revenue.