This suggests an enormous opportunity for Native American land, normally mired in poverty. Establish free trade zones, not subject to the anti-business, heavily taxed rest of the states.
Maybe they hire some tribe members for jobs, but I would bet only for the untrained jobs. Possibly they'd benefit some from selling/leasing the land and other set up fees, but even that they might pull the usual corporate "tax break" scheme.
Besides, it's entirely possible the way the state fixes this "loophole" puts them in a worse position than currently. The history of renegotiating often doesn't end well for the Natives.
For Tesla at least, taxes are not so much an issue as the regulatory regime prohibiting them from operating outside of reservation altogether. They are happy to pay higher tax, if the alternative is inability to sell cars at all.
But, in general, even if the tax rates on tribal lands are lower than on regular state lands, the tribes still benefit, because it is them who collect the tax, rather than the State. Many polities would rather have a smaller bite of a cake rather than no cake at all. Look at Ireland, for example, which is greatly benefiting exactly from being a EU tax haven: sure, it collects less from Google or Apple than, say, France or Italy would, but they still benefit from their low tax policy.
> and the infrastructure built is unlikely to be useful after the business is gone
If you read the casino, you’ll find that Tesla is actually renovating and using a former casino facility.
> Besides, it's entirely possible the way the state fixes this "loophole" puts them in a worse position than currently. The history of renegotiating often doesn't end well for the Natives.
Yeah, that’s sadly correct: the governments tend to screw small people over when it sees its power and revenues diminished.
Other than that, tax havens have more independence than reservations do. They have theoretical sovereignty, but the federal government largely controls things like police and education. Like when one tried to legalize recreational marijuana the feds immediately threatened a raid.
A group of people are walking down the street when one person among the group points out a 20-dollar bill on the sidewalk. The armchair economist in the group says, "There is no 20-dollar bill here, because if there were, someone would have picked it up by now." Everyone in group defers to their friend's brilliant insight and keeps walking.
No, what they've done with casinos is leverage demand plus state prohibition to eatablish heavily regulated, heavily taxed, licensed local monopolies, that extract monopoly rents from consumers, and from which the native governments likewise extract monopoly rents (leaving sufficient remainder for the operators to be happy with the deal.)
Casinos are pretty much the opposite of the proposed “win the race to the regulatory and revenue extraction minimum” game suggested for the “free trade zones”.
What's the opportunity there? The opportunity to attract economic activity without capturing revenue from it, while incurring all the environmental costs?
Seems to be an anti-opportunity.
I.e. plenty of opportunity for the locals.