November 20, 2018. This article discusses the tax breaks that Governor Cuomo has agreed to give Amazon for moving one of their headquarters to Long Island City. The article goes on to discuss the Governor’s argument for agreeing to provide Amazon with an estimated $3 billion in subsidies that includes city and state tax breaks, infrastructure slush funds, and helipads, which he argues is benefiting New York State because if he didn’t provide these tax breaks the state would miss out on the revenue that Amazon will bring. The author analyzes Cuomo’s argument for the tax breaks and highlights that Amazon would not come to New York without them, the Governor’s argument could apply to any taxpayer, New York could spend its money differently and still make a large profit, there are costs to hosting Amazon and calculating “taxes paid” as a return on “taxes not paid” is not a normal technique for bookkeeping.
This is a big money-maker for us — costs us nothing, nada, niente. We make money doing this,” Cuomo said on Tuesday, adding, “The revenue-to-incentive ratio is 9-to-1. That is the highest rate of return for an economic incentive program that the state has ever offered.” Two days later, he reiterated this argument: “You give us $1 billion, we’ll give you 100 back. I would do that all day long.” On Monday morning, the governor published an “op-ed” on his website asserting, “New York doesn’t give Amazon $100 million. Amazon gives New York $900 million.”
“Our offer essentially was, instead of paying us a billion, you pay us $900 million, hence, the 100 million per year subsidy,” Cuomo told Brian Lehrer on Monday, shortly after his press shop distributed the op-ed. “Now, we’re not giving Amazon 100 million a year, they’re giving us 900. ‘Well they could have given you a billion.’ Yeah, only if they came here, you know? Otherwise we would be out $900 million.”
Calculating “taxes paid” as a return on “taxes not paid” is just a seriously weird way of doing bookkeeping. “It’s not the way taxes work,” says Fiscal Policy Institute deputy director David Kallick, noting that the whole point of taxes is to pay for the additional public services that a resident or employer needs. “If Cuomo wants to make a state investment in Amazon, he should also get an ownership share. That’s not a crazy idea, actually.”
Here is the link to the Gothamist.