You are here:  Home  >  Economy  >  Current Article

Company tax incentives don’t spur economic growth

Posted by   /  January 8, 2020  /  No Comments

    Print       Email
Illustration: Sarah Grillo/Axios

By Dion RabouinJan | Axios

More than two years after Amazon announced its search for a second headquarters and cities around the U.S. bent over backwards to offer the megacompany as much free cash and incentives as they could, new research confirms what economists have been saying for years: Such programs are a waste of money.

Driving the news: A paper from researchers at Princeton and Columbia Business School found “no evidence” that business tax incentives given to individual companies increased broader economic growth at the state and local level.

Why it matters: It’s not just Amazon’s highly publicized HQ2 that has attracted massive tax subsidies from city and state governments.

Research shows states continue to offer up increasingly large sums of money to big-name companies in an effort that proves more effective at generating headlines than economic growth.

Details: In 2014, the study found that about $7 billion — or about a third of total state incentive spending that year — “went to .0072% of new firms and 1.41% of all jobs created by those firms.”


    Print       Email

Leave a Reply

You might also like...

Gilbert Councilman Eddie Cook named Maricopa County assessor after Paul Petersen resignation

Read More →