(The State) Amazon packing after South Carolina tax vote

Posted by Kendall Harmon

Amazon all but told South Carolina goodbye Wednesday after the online retailer lost a legislative showdown on a sales tax collection exemption it wants to open a distribution center that would bring 1,249 jobs to the Midlands.

Company officials immediately halted plans to equip and staff the one million-square-foot building under construction at I-77 and 12th Street near Cayce.

“As a result of today’s unfortunate House vote, we’ve canceled $52 million in procurement contracts and removed all South Carolina fulfillment center job postings from our (Web) site,” said Paul Misener, Amazon vice president for global public policy.

Read it all.

Filed under: * Culture-WatchBlogging & the Internet* Economics, PoliticsEconomyCorporations/Corporate LifeTaxesPolitics in GeneralState Government* South Carolina

12 Comments
Posted April 28, 2011 at 3:10 pm [Printer Friendly] [Print w/ comments]



1. Grandmother wrote:

Well, I sure hope our representative likes serving one term in the house (if he voted for this).. DUMB, DUMB, DUMB,,, Perhaps 1000 or more jobs, down the tubes… And when they take Boeing out, we might as well close up shop.
Grandmother in SC

April 28, 7:36 pm | [comment link]
2. loyal opposition wrote:

I know that it is a loss of potential jobs for the state of South Carolina but why in the world should Amazon be exempt from collecting taxes that every other retailer in the state must collect?  Think of this as a move by the legislature to enable local retailers to compete on a level playing field.  Surely, more than 1,400 jobs are saved by removing Amazon’s “duty free” status.

Californian

April 28, 8:23 pm | [comment link]
3. Grandmother wrote:

IT was NOT a “retailer”.. It was a “distribution center”.. Meaning, unlike the Piggly Wiggly here in Ladson/Summerville, they will not distribute to local stores.. So, only folks they “ship” to, but not sell to will pay a tax?  The Pig distribution center, distribute to the South Carolina stores.. When’t the last time you shopped in an Amazon Store?
Grandmother

April 28, 9:15 pm | [comment link]
4. Village Vicar wrote:

I think it is very telling that Walmart led the charge in opposing Amazon - Walmart is not known for enabling local retailers to compete on a level playing field (in fact, tends to decimate local businesses when they open shop - an effect Amazon would not have had) .  In fact, this was nothing less than a national coup that Walmart has managed to pull off.  Who else other than Amazon would be one of their largest competitors?  I think it is seriously unfortunate that our state leadership would renege on a commitment made.  I certainly hope they crunched the numbers, but can’t help think that the revenue generated by the jobs and other smaller support businesses that would have surrounded Amazon most likely long-term outweighed the loss of sales tax revenue.  SC does have a history of sellling out itself (cheaply) for the sake of jobs in ways that have not been a blessing (witness the nuclear processing and storage complex at Barnwell, the steel mill in Georgetown, and others no doubt.  On the other hand, having BMW in the northern part of the state has proven to be a real economic engine.  This feels like a major mistake to me.

April 28, 9:24 pm | [comment link]
5. Teatime2 wrote:

Amazon did the same thing here. They closed down their Dallas operation over the tax issue. Guess they’ll have to base all of their operations in New Hampshire, which has no state sales tax.

April 28, 10:44 pm | [comment link]
6. montanan wrote:

We’d take them in Montana - also with no sales tax….

April 29, 1:03 am | [comment link]
7. kmh1 wrote:

#6 - or summer.

April 29, 2:13 am | [comment link]
8. kmh1 wrote:

...no, not true, I know.

April 29, 2:18 am | [comment link]
9. Hakkatan wrote:

I started reading a book a couple of years ago called “No Free Lunch” which tells of the tax break mania that began in the 80’s, and some other special exemptions for huge corporations - and how unfair such deals are.  They are also often destructive to the local economy, and seldom generate as much secondary income as estimated. Another aspect of some of the major policy changes began at the same time was the use of the power of eminent domain to declare whole neighborhoods needed for some “economic engine” (sports arena or such) that was supposed to help the local economy but was also not a state enterprise but a for-profit business.  These changes (and some others) changed the nature of capitalism in the US and skewed the situation in favor of the rich and powerful.

Delaware also has no sales tax.  It also has a tax structure which favors corporations, and is the “HQ” of quite a few companies for that reason.

April 29, 4:35 am | [comment link]
10. David Keller wrote:

In upstate South Carolina we gave BMW tax breaks to move here in the 80’s.  Greenville Spartanburg is one of the few places in America where home values haven’t crashed (they’ve actually gone up, modestly)and where the recessission has had a relatively small effect. BMW has 1000’s of employees and ther suppliers have 10’s of thousands more. We have gone from being a sleeply textile town, where the mills were closing, to being one of the most vibrant economic engines in America.  The book sounds nice, but the proof is in the pudding.

April 29, 4:13 pm | [comment link]
11. Hakkatan wrote:

David, I am sure that there are some very real success stories like that of BMW.  That does not mean that the policy is inherently sound.  The book speaks of the principle winding up favoring, for the most part, a select few, and skewing the market place.

April 29, 4:18 pm | [comment link]
12. Sarah wrote:

I’m opposed to most central planning—and the legislators deciding to give tax breaks to some but not others is definitely central planning.  They’re choosing which “jobs” and companies they think are best for us.

I think years ago I would have been for the tax break.

But judging by our new governor, this is *actually* a fight between 1) those who want lower across the board tax rates and regulations and 2) those who want to keep the status quo and continue choosing winners and losers through jerry-rigging the tax code.

Haley has been quite clear.  She believes that SC should drastically revise and flatten taxes and regulations throughout the state and thus create a business environment that is incredibly alluring to any company to come here—and then let the chips fall where they may.

I don’t have any interest—none whatsoever—in Bobby Harrell’s opinions about which companies should or should not survive and thrive in SC.

April 30, 7:27 am | [comment link]
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