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Tax Abatement: Amazon’s search continues, but is it good for cities? Tread carefully.

The bidding war for Amazon’s next Head Quarters is getting white hot. According to Amazon, there have been, so far, 238 proposals from cities located in 54 different states – majority coming from the United States, with entries from Canada and Mexico.

But just like anything in life & business, there are always the PROS and CONS. And each city sees the potential 50,000 new jobs created for their individual cities to the crowing PRO for attracting the online retail behemoth.

The CONS can be complex, in contrast, which would include: lost immediate revenue for the particular city (i.e. tax incentive), possible additional infrastructure build up costs, rising property costs and/or low ROI (return on investment) for each dollar spent on bringing that company over.

For each government body it’s something that cannot be ignored. The promise of a business leader in one’s municipality is a glorious thought experiment.

In addition, for the elected government officials, it would mean a large win for their re-election bids, if done right.

It’s a double edged sword. But let’s see how things will turn out, for progress, sometimes is messy and receiving benefits isn’t a strict 50/50 equal return proposition.

To sum up the possible dilemmas of such fortunes, here’s a vid by John Oliver (HBO). It’s a good summary to start.

The Balance
Area Development
Philadelphia Weekly


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