Rotten Apple in Raleigh
May 12th, 2009 by John Grooms in Boomer with an Attitude
The law that’s supposed to lure Apple Computers to North Carolina could also wind up deterring more job creation if the company is more successful here than expected.
First, some background: The General Assembly in Raleigh has been in a big hurry lately to pass a bill offering new forms of tax incentives to Apple Computers, which is considering building a facility somewhere “in the western part of the state.” Under the bill, companies that are designated “capital intensive” would only pay taxes on their N.C. sales, rather than the way other companies pay, with taxes based on sales plus a company’s property and payroll. The big, big downside, though, as pointed out by The Progressive Pulse, is that if a company receiving such a tax break wanted to expand its work force in North Carolina, they could lose their “capital intensive” designation and thus, raise their own taxes. In other words, the state is offering incentives for Apple to build here, but at the same time is effectively dissuading Apple from hiring more people. What will those wacky lawmakers think of next?
Progressive Pulse also noted that yesterday, Dell Computers in Winston-Salem revealed its plans for layoffs at its N.C. facility. As PP writer Elaine Mejia put it, “Guess that special tax credit for ‘computer manufacturers’ that we put in place to lure Dell isn’t working out so well. So much for learning from past mistakes.”
May 12th, 2009 at 4:40 pm
Good point about the dis-incentive to expand. Grooms gets a clue now and then but then it fades from his memory.
Special deals also leave a bad taste in the mouths of companies that are already here. What NC needs to do is cut out all of this special favor BS and just create a low tax environment for all companies to enjoy. This would result in the economy not needing to be micro managed and companies would be coming here all on their own without special deals shoved in their faces.