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Though usually not enough to make up the difference in incentives. If we take the Amazon NY incentives at face value, each employee needs to pay $25k in taxes t

Though usually not enough to make up the difference in incentives. If we take the Amazon NY incentives at face value, each employee needs to pay $25k in taxes to make up the difference just on the initial tax break alone. That doesn’t count extra expenditures for expanded public transportation or nearby development. That’s also if amazon hires the proposed 40k new employees on day one, which they won’t. There’s a good argument to be made that spending that money elsewhere would provide better outcomes and on shorter timelines than giving one of the largest companies in the world a tax break.

C1sc0cat 8y ago
Which given FANG salaries they will do. And the state and NYC preying in aid the problems with its tube system is deeply cynical, maybe try to be 1 less corrupt and competent
- bdhess 8y ago
  $25k in state and local taxes would be high even for FANG in NYC
  - Eridrus 8y ago
    They'll pay that in income taxes alone in 2 years.
    - alistairSH 8y ago
      Probably not; 2 years is overly optimistic. See my reply above.
- alistairSH 8y ago
  The highest marginal tax rate in NYC is 3.65%. The effective rate on a $140,000 salary is about 2.6%. Leaving a local tax liability of about $3500. On the same income, NY state has a marginal rate of 6.45% and an effective rate of about 4.3%, for a liability of $6,000. So, in year one, that's a bit over $9000 in revenue from a highly compensated employee. If the $25k figure stated above it true and a one-time incentive, it takes 2.5-3 years to pay off. Employees earning less than $140k will take 3+ years to pay off. If the incentives are recurring in any way, then the payoff is pushed out even more. But, as mentioned, the employee doesn't just have to "pay back" the initial incentive, she has to produce tax revenue to pay for increased services and infrastructure demand, pushing the timeline out even further. Anyway, the NYC deal doesn't sound to bad. Even at a 5-8 year pay-off, if the positions are relatively long-lived, it's a long-term positive. But, when we consider the Foxconn deal in the Mid-West, ouch, that one's going to sting the local community for a long time.
  - gok 8y ago
    The deal requires an average wage of $150,000. [1] And with the nature of variance in salaries combined with progressive taxation works out even better for the state; one $100K and one $200K employee will result in more revenue than two $150K employees. [1] https://www.documentcloud.org/documents/5096409-New-York-Agreement.html https://www.documentcloud.org/documents/5096409-New-York-Agr...
  - Faark 8y ago
    More citizens mean more cost for the state, aka the thing taxes are supposedly collected for. Amateur here, so I might just missed it, but where did you account for those marginal cost? I have a hard time believing original residents actually benefit that greatly from those deals as well. Yes there are benefits of getting more people and well paying jobs into the region and some competition to keep taxes reasonable seem fine. But to me this still mostly seems like a transfer of wealth and power to big cooperation, boosting societal problems we already have a hard time dealing with.
    - alistairSH 8y ago
      The 4th paragraph.

C1sc0cat 8y ago

Which given FANG salaries they will do. And the state and NYC preying in aid the problems with its tube system is deeply cynical, maybe try to be 1 less corrupt and competent

bdhess 8y ago
$25k in state and local taxes would be high even for FANG in NYC
- Eridrus 8y ago
  They'll pay that in income taxes alone in 2 years.
  - alistairSH 8y ago
    Probably not; 2 years is overly optimistic. See my reply above.
alistairSH 8y ago
The highest marginal tax rate in NYC is 3.65%. The effective rate on a $140,000 salary is about 2.6%. Leaving a local tax liability of about $3500. On the same income, NY state has a marginal rate of 6.45% and an effective rate of about 4.3%, for a liability of $6,000. So, in year one, that's a bit over $9000 in revenue from a highly compensated employee. If the $25k figure stated above it true and a one-time incentive, it takes 2.5-3 years to pay off. Employees earning less than $140k will take 3+ years to pay off. If the incentives are recurring in any way, then the payoff is pushed out even more. But, as mentioned, the employee doesn't just have to "pay back" the initial incentive, she has to produce tax revenue to pay for increased services and infrastructure demand, pushing the timeline out even further. Anyway, the NYC deal doesn't sound to bad. Even at a 5-8 year pay-off, if the positions are relatively long-lived, it's a long-term positive. But, when we consider the Foxconn deal in the Mid-West, ouch, that one's going to sting the local community for a long time.
- gok 8y ago
  The deal requires an average wage of $150,000. [1] And with the nature of variance in salaries combined with progressive taxation works out even better for the state; one $100K and one $200K employee will result in more revenue than two $150K employees. [1] https://www.documentcloud.org/documents/5096409-New-York-Agreement.html https://www.documentcloud.org/documents/5096409-New-York-Agr...
- Faark 8y ago
  More citizens mean more cost for the state, aka the thing taxes are supposedly collected for. Amateur here, so I might just missed it, but where did you account for those marginal cost? I have a hard time believing original residents actually benefit that greatly from those deals as well. Yes there are benefits of getting more people and well paying jobs into the region and some competition to keep taxes reasonable seem fine. But to me this still mostly seems like a transfer of wealth and power to big cooperation, boosting societal problems we already have a hard time dealing with.
  - alistairSH 8y ago
    The 4th paragraph.