Ohio

Last month RMI Titanium Inc. joined the growing list of companies that have sought individual tax assistance in their consideration of business expansion. Vindy.com stated that, "according to state documents, receiving the job creation tax credit will play a big role in RMI's decision to expand in Ohio." Then again, the state did not reveal whether these credits would even be necessary if the tax burden was significantly decreased for all businesses.

Arizona

In paying tribute to Luis Gonzalez' tenure as an Arizona Diamondback, writers for the Tuscon Citizen question the loyalty of teams towards their marquee players, especially given the public investment in the facilities that support these teams:

But where's the loyalty today?

When I was a tadpole, there were three giants who walked the Earth: Stan Musial, Ted Williams and Joe DiMaggio. Santa Claus himself would be sold or traded before one of those guys. Were they around today, though, the Cardinals, Red Sox and Yankees wouldn't blink an eye before peddling Stan, Ted or Joltin' Joe. Let the fans go to blazes if there's big money involved.

Somewhere in a cookie-cutter home in the sprawl of Phoenix, or here in Tucson or in Flagstaff, or on some reservation, a little kid is crying his eyes out because his beloved Gonzo will not be playing for Arizona again.

Me and my buddies - Suds, Jimmy, Butch and Greasy - would have done the same thing had Musial, Williams or DiMaggio been swapped like a used car.

These teams get all kinds of tax breaks and land for stadiums paid for by the public. Then they gouge the paying customer as much as the law allows, bring in ballplayers they hope will connect with the fans in such a way that tax-breaks and gouging will be forgotten.

I think the author has a point, but I wish he would throw some of his anger towards the way of the politicians as well.

Massachusetts

State lawmakers in Massachusetts have doubled the number of Economic Target Areas to 40, allowing more businesses to have access to less of a tax burden. Bureaucrats like to tout the success of these types of progams, but it should not be surprising that business owners would want a break from being highly taxed by the state. They also avoid the issue of what gives them the right to decide what businesses and localities deserve state tax breaks. The whole system is an inefficiently operated monopoly on the lowering of tax burdens.

It's also a wonder how these lawmakers come up with statistics like this one, reported in the Milford Daily News:

The sponsor of the bill, Sen. Harriette L. Chandler, D-Worcester, hopes more communities can benefit from this extra incentive. The state put $66.2 million into ETAs between 1995 and 2004. In return, the program netted $66.4 million in economic development related to some 50,000 jobs, Chandler said.

"ETAs help spur economic development and create jobs in communities most in need," said Chandler.

Actually, ETAs are an easy for politicians like Ms. Chandler to suggest to a naive public that it was they who created the jobs, not the actual owner of the business.

California

The Examiner reports that "[t]housands of businesses on San Francisco’s east side will remain eligible for state tax breaks if The City wins approval from Sacramento in coming weeks." As the goal of these "Enterprise Zones" is to provide incentives to business to invest in economically depressed areas, there is a debate as to whether these incentives are appropriate in San Fran.

Jean Ross, executive director of the California Budget Project, suggests that “San Francisco stands out as an area that doesn’t need taxpayer dollars to further its economic development" and compares the Golden Gate City's situation to that southeastern California's Imperial Valley, where is a 30% unemployment rate.

Regardless of the merits (or lack thereof) of her argument that San Francisco businesses are undeserving of tax breaks, Ms. Ross falls into the classic trap of equating state tax breaks with giving away taxpayer dollars. Tax incentives either reduce the amount of taxable income in the form of a deduction or they reduce the total amount of tax liability in the form of a credit. But neither form gives money to businesses directly from the state treasury. Suggesting that tax breaks throw away taxpayer dollars incorrectly assumes that the amount of investment and income generated by a business is not influenced by tax regimes. Without a tax break, a business does not invest and hence does not generate any more taxable income or create any more jobs or offer any more products to the public. With a tax break, there will more investment, income, jobs (income tax), and products (sales tax), while the tax liability will, theoretically, remain the same. All in all, it seems fairly clear that the economy is better off when a business is able to lower its tax burden in one way or another.

That being said, we would all be much better off if state and local governments got out of the business of deciding who gets this tax break and who gets that tax break and instead concentrated on offering a simple and low tax rates for all businesses, large and small.

Kansas

The Kroger Co. is looking to create an organic and soy milk operation near one of its exisiting dairy farms. In the running for the plant are locales in Kansas, Utah, Tennessee, Colorado, and Texas.

The Hutchinson News reports that while bureaucrats in Reno County, Kansas, are scrambling to decide how much to offer in incentives to Kroger, no such breaks appear to have been offered in Murfreesboro, Tennessee, as the Volunteer State has "business-friendly tax rates to help offset a no-incentives policy."

Michigan

Yesterday, Bill Ford stepped down from the CEO position of Ford Motor Co. Ford Motor's performance has been terrible of late, and the great-grandson of the company's founder is apparently not the man to turn things around. Not even a generous tax incentive deal could save him, as analysts recognized that it would only be "a slight positive" for Ford.

West Virginia

Immigration, legal or illegal, enters the tax incentive debate. Steve White, director of the Affiliated Construction Trades foundation, laments in Monday's Huntington Herald-Dispatch that "[t]ax credits [are] going to companies who import low-wage workers, perhaps illegally in this country, who take jobs currently held by local workers. It's a sad state of affairs."