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Comment by Retric | Hacker News Reader

In many ways I think this should be illegal. If for no other reason as it creates huge incentives for bribery up front and after these expire to keep a factory from moving. But, also because at a constitutional level it interferes with state commerce much like Nevada deciding on an import tax from other states.

However, city's or states lowering their taxes on every business is a different story.

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And this is why many enter politics. It's why there's such a huge lobbying industry; why there is such an industry. We entrust them with a lot of power, they just wield it.

I actually have no problem with a state doing this, so long as they dish out the tax breaks equitably.

I don't see how targeted tax breaks could be equitable.

Even if it's not completely equitable it doesn't have to be 0 or negative sum.

If I were making 15 an hour at the local casino, I'd be pretty happy to pay more taxes and take a 25 dollar an hour job at Tesla. Sure, Tesla isn't paying its full share but we're both better off.

> they dish out the tax breaks equitably

A tax break by definition is something that's not dished out equitably. :) ("Favorable tax treatment of any class of persons" is how Wikipedia describes a tax break, which sounds about right.)

What you're describing is the opposite of a tax break. One example would be across-the-board tax relief such as lowering income taxes or property taxes for everyone, whether they're in an industry favored by the current politicians in office or not.

Agreed! Not about Tesla, but noting the constitutional angle -- http://gondwanaland.com/mlog/2013/10/14/negative-sum-us-stat... -- I have not searched much but would love to know if anyone serious has arrived at this conclusion.

If you can tax gasoline to reduce the amount used in your state, you can untax battery manufacturers to get more of them.

Your comparing production of something with it's use. There giving incentives to a factory so the equivalent would be subsidizing a refinery which as you might imagine would have little impact on gas usage in a state.

I'd guess it's not really about the batteries, although it is cool. It's about the 6,500 jobs Tesla plans to create. Over the 20 years this tax break runs, that $1.25B is about $9,600 per employee per year. They might make that up in payroll, sales, and property taxes from the employees alone.

>They might make that up in payroll, sales, and property taxes from the employees alone.

I might be wrong, but I think Nevada doesn't have income tax. And property tax is typically paid to local county/city governments.

I think it's still open to debate whether Nevada will really recoup all this money in taxes. Of course there are benefits other than pure tax dollars. This could lead to a convergence of high tech manufacturing in the area.

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