Why give tax breaks to the most profitable corporations in the world? The local authorities have to provide infrastructure, etc., and get no revenue?
If You don't, big corps will move elsewhere including overseas.
Why give tax breaks to the most profitable corporations in the world? The local authorities have to provide infrastructure, etc., and get no revenue?
Of course you did. You asked for breaks for childcare, college tuition, home ownership, the tax collector's appraisal of your house, etc., etc., etc. You just went through an agent (your congressperson, etc.) instead of negotiating directly.
Any company that wouldn't consider the best deal would undoubtedly have to answer some difficult questions from their shareholders.
According to this, the Feds would have received an additional $2.4B this year if Apple didn't move their offices to other countries. Even California loses out in tax revenue.
http://www.nytimes.com/2012/04/29/b...ategy-aims-at-low-tax-states-and-nations.html
Estimating the gain to Travis county's tax base is not speculative. There will be an increase of approximately $304 million in improved property. Travis county's property tax rate for the city of Austin is 0.4811/$1000. That's about $1.47M/yr. The center will employ approximately 3600 people. If the majority of the employees are call center representatives their average salary will be something near $30K. That's about $108M/yr coming into the county from Apple. There is no income tax, but the local sales tax is 8.25%. If we estimate that one-third of peoples salaries is spent on goods and services, i.e. the local economy, then approximately $8.9M/yr in sales tax will be collected, although I have no idea what part of that will go to the county. These two factors alone suggest that Apple's presence will add somewhere in the neighborhood of $10M/yr in tax revenue to the state and county.
I have read several of you posts and you have a hard time getting around this concept that the county's tax revenue base is not fixed, it can grow or shrink, depending on the amount of improved property, or sales tax.
Sure, but those tax breaks affected more than just a single person or company.
Any company? We're talking about Apple.
Cheers!
Why give tax breaks to the most profitable corporations in the world? The local authorities have to provide infrastructure, etc., and get no revenue?
Texas is in a better economic position than much of the US right now. Maybe they don't need to bend over for Apple?
I do have an honest question though - if an employee leaves their current company to go work for Apple, doesn't the now vacancy of their job mean another person is hired in their place? That is, after they have moved to Apple, won't their former job be filled by someone else? The net effect, it would seem, is still increasing jobs. This would mean a fair bit of increased revenue to the state, even if it is bit by bit.
Texas doesn't pay state income Tax 0%, property tax is only around 1% once a year and auto is like $75 less than 1% a year! So I think Austin will be ok, Texas has one of the best unemployment %'s in the country.
Texas doesn't pay state income Tax 0%, property tax is only around 1% once a year and auto is like $75 less than 1% a year! So I think Austin will be ok, Texas has one of the best unemployment %'s in the country.
I've run into the same thing recently. Full time staff person leaves and are 'replaced' by a part-timer or no one at all.Not necessarily - in some cases, the company may decide to cut hours or staff altogether. Where I work, all my direct reports are part-time. When I first got here, I had 105 hours to work with. Now I have 65. Every time someone left, it was decided (higher up) that we didn't really need all those hours. My 40-hour person was replaced with a 20-hour person. My 35-hour person was replaced with another 20-hour person. One wasn't replaced at all. Instead, I'm the one (because I'm exempt) who's left to fill the void in the hours (which is apparenty every time I go on vacation, and there's a nice 40+ hour hole in the schedule).
So that "3200 jobs" for Apple may end up costing a few positions in the long run.
...At the same time the majority of their employees live in California, use California resources (schools, roads etc.) but Apple avoid paying California taxes. Does anyone think that this is fair? Please speak up!
...I'm the one (because I'm exempt) who's left to fill the void in the hours (which is apparenty every time I go on vacation, and there's a nice 40+ hour hole in the schedule)...
Incorrect. You are assuming that everyone there will be purchasing new property adding new property tax. 30k a year and they are buying houses? Many people will live in apartments paying no real estate tax and many will move into existing homes displacing others moving out resulting in no new property tax. Plus, you are assuming people will live in the same county--many will live outside of the county they work in and commute.
Moreover, you are also assuming people will spend all their money on taxable goods in the same county--you can't assume that either.
Your assumptions are extremely favorable and high. And when you drop out all the favorable assumptions it becomes much less clear and more murky.
I did not even address the purchase of property by individuals. The $304M was the value of the expanded call center.
The sales tax is collected by the state, so I referred to this revenue as state and local. The tax incentives are being paid by both state and local (Travis County, and city of Austin), so I did not feel it necessary to distinguish where the sales taxes were collected. Most of the money spent on goods and services by call center employees will be in the state of Texas.
So many flaws in your reasoning, starting with the fact that the property tax loss (50% for ten years) is local but the tax gains are to the state.
Oh. My. God. This is really getting tiresome. Firstly, the state does not collect local property taxes. Secondly, even if they did, there are no "tax gains" to the state if the assessed value of the thing being taxed decreases in value. Thirdly, I was talking about sales tax distribution between local and state governments, not property tax. That's it, I'm done. We will have to agree to disagree about this. Good evening to you, sir.