Wednesday, August 30, 2006

Corporate Tax Breaks lead to corruption

Giving large corporations targeted tax breaks to "induce" them to come to your state or city is bad policy at the very least and at its worst, leads straight to corruption. The State of TN and many cities, like Memphis through their PILOT program, give away tens of millions of taxpayer money every year. The best policy is always to keep taxes low for EVERYONE, not just the big corporations. That is the key to strong economic development.

HERE is a great investigative piece by the St Petersburg Times:

"Enterprise Florida encourages the Legislature to create and expand corporate tax breaks and grants. It negotiates - often in secret - with companies that contemplate moving or expanding here. And when it recommends incentives for a company, the governor's office almost always approves.

The Orlando-based organization, which has gotten more than $100-million in state money since 2000, likes to boast that it is a national model for doing government work with the savvy and efficiency of private business.

As the BellSouth case suggests, however, another description might be this: a network where back scratching and self-dealing sometimes seem more important than its mission."