Slog - Comments on Oly Action: Millions in Tax Breaks

Comment by Will in Seattle

Will in Seattle — Wed, 27 Feb 2008 15:36:01 -0800

So why aren't all corporate tax exemptions subject to voter approval after say four years, with detailed analysis on whether or not they actually created the stated jobs and revenues, and then have to go back for a vote every four years?

Because - when they get an exemption - the middle class and the poor get to pay the difference.

(and the first Ron Paul that pops up and says corporations don't pay tax I'm shipping in a pine box to the EU to be fined by their competition commissioner ...)

Comment by Clint

Clint — Wed, 27 Feb 2008 15:44:53 -0800

Actually, if Microsoft didn't get the tax break, they probably wouldn't put the server farm in Eastern Washington. It isn't a situation where we are giving away tax money. The net is that we are giving tech jobs to Eastern Washington. What's the big deal?

Comment by Eric

Eric — Wed, 27 Feb 2008 16:04:26 -0800

Devil's advocate really quick. The sales tax is regressive, so in most cases it's a step toward progressive taxation when we reduce the sales tax (though it means less total tax revenue, obviously). Energy efficient appliances tend to be expensive.

But by exempting efficient appliances from the sales tax, it essentially cuts consumer prices for them by 8 to 9 percent, thus making them cost-competitive with less efficient models. That's a loophole that makes taxes less regressive in a way that it yields less energy use and climate emissions.

Point is: a loophole isn't inherently bad; it's only bad when it advances bad policy outcomes.

Comment by Fnarf

Fnarf — Wed, 27 Feb 2008 16:05:13 -0800

Could we just find 25 tech workers in Eastern WA and give them $3 million each? Or just a million, and then we'd still have $50 million left over? What's so great about 25 freaking jobs?

Comment by Will in Seattle

Will in Seattle — Wed, 27 Feb 2008 16:49:46 -0800

@2 - bull, they want to build there due to labor costs, land costs, and power costs, as well as availability.

Plus it lowers their global warming emissions, since it's hydro-based, so they can use it to offset coal plants for server farms elsewhere.

Try again.

No tax breaks.

Comment by ouch

ouch — Wed, 27 Feb 2008 17:08:05 -0800

Hey Josh didn't the transportation bill pass funding all kinds of road work?

Comment by ouch

ouch — Wed, 27 Feb 2008 17:15:37 -0800

they are passing on collecting sales tax on equipment so if we followed fnarf's advice we would lose $25 million whereas this way we gain a few jobs and use up some energy - the bigger issue is explaining to every other business why they need to pay sales tax on their capital equipment.

Comment by Aaron Keating

Aaron Keating — Wed, 27 Feb 2008 17:16:48 -0800

Add those new tax breaks to these: from 2004-2006, legislators passed 61 measures either granting new tax preferences or extending old ones that will cost the state nearly half a billion dollars in the 2007-09 biennium.

Comment by laterite

laterite — Wed, 27 Feb 2008 17:29:09 -0800

Data centers aren't really where the "hot" tech jobs reside. You maybe need a staff of 20-25; some for the adminstrative overhead, the rest are guys who run cable and rack servers all day. They're not getting paid a king's ransom either, so the whole "creating high tech jobs in Eastern Washington" thing is mostly hot air. Putting them along the Columbia is just a way to keep the power costs low so the presumable return to shareholders is increased. The programmers and application developers can be anywhere, really.

Comment by Will in Seattle

Will in Seattle — Wed, 27 Feb 2008 17:56:45 -0800

Want to create good paying high tech jobs in Eastern Washington?

Take the same money and use it to BUILD wind farms that co-locate with existing farmland.

Creates way more jobs, helps America, and creates way more jobs from the extra energy, instead of sucking it up for server farms.

Econ 200.

Comment by kinkos

kinkos — Wed, 27 Feb 2008 19:37:00 -0800

they're paying sales and property taxes on that data center as well as building the thing from the ground up. i hate corporate tax breaks but the giveaway is probably 50% of the actual tax break.

Comment by ouch

ouch — Wed, 27 Feb 2008 20:06:05 -0800

econ 200 would be macro and this would be micro so more likely econ 201 and Will there is no money, the state isn't giving them $75 million it is not collecting $75 million c-a-n y-o-u
u-n-d-e-r-s-t-a-n-d the difference?

Will repeat - there is no money spent - there is only money not collected by forgiving half the sales tax on the equipment.