Illinois Grants Corporate Tax Credits to Amazon
This year, several taxpayers in Illinois are probably going to be seeking help with a tax lawyer (if they haven’t already done so) following a state budget crisis. However, one major corporation is certainly rejoicing after evading any kind of negative impact from the state’s current financial issues.
Though Illinois budget problems have caused several employees to lose their jobs and are struggling to make ends meet, the state had no qualms in extending a special bundle of corporate tax credits to its most valuable retailer, Amazon.
According to the state Department of Commerce and Economic Opportunity, the online retail mogul (which is valued at a whopping $250 billion and, let’s be honest, doesn’t really need a tax break, let alone several) obtained the credits because of a prior “commitment.”
On the upside, Amazon officials have stated that its new warehouse in Joliet will lead to the creation of 1,000 full-time jobs for locals. Well, that’s kind of a plus. Tax credits for more job opportunities? Sure, it helps, but only for the 1,000 people who will be getting those jobs.
However, Amazon isn’t the first company to get a tax break. Major corporations, including Sears Holding Corp. and the Chicago Board of Trade threatened to leave Illinois and set up shop in states where lawmakers were offering better, shall we say, “incentives”. Out of fear to lose these well-established companies (and to help bring in new ones), Illinois officials struck a deal with the corporations in 2011, granting them corporate tax breaks to stop them from leaving the state.
While Illinois lawmakers may have somewhat good intentions in trying to keep big named companies that bring in revenue for the state, not everyone agrees with this approach. Many argue that tax breaks don’t have that big of an influence over a company’s decision to stay or go, and some opponents have even likened the practice to bribery.
Exactly how much of a tax break Amazon and these other companies are getting is anyone’s guess. Over in Wisconsin, state lawmakers agreed to cough up $10.3 million in tax credits to Amazon in exchange for 1,250 new jobs. If that’s anything like what Illinois lawmakers agreed to, Amazon is certainly coming out on top.
What’s not up for guessing is the fact that many people in Illinois are likely fuming over the state government’s seemingly biased interest in favoring these corporations over its actual taxpaying residents. Smaller businesses may also want to consult with a tax lawyer in Illinois to see about getting credits of their own.