If you make $50,000 per year ....

[wercal]

62. The Wal Mart type incentives are usually local

The tax breaks for opening a story in Anytown, USA is usually not an income tax break....it is a break on paying property taxes to the local state, county, city, school district. They are also usually given prime land very cheap or free.

Companies like Wal-Mart are not stupid, and they hold out for these tax breaks. There is a cottage industry for this - they even have a trade magazine, giving updates on how much different cities and towns are willing to give away. The Wal-Marts of the world have created a competitive environment, where cities are pitted against each other...any new factory, major distribution center, etc. in this country will try this ploy.

In general, I think most of these should be made illegal. It violates equal protection to waive taxes for some, but not others. The one exception in my mind would be the Tax Increment Financing (TIF) District. The philosophy of this district is - 'Hey, that piece of ground is run down, with practically no property taxes generated - let me borrow money from the next 15 years of taxes, that would be paid, if I put something new and valuable there'. This mechanism has the potential to build new infrastructure in very blighted areas...and I have seen it used with success. Although, there have been significant failures as well. But the underlying 'giveway' is future property tax dollars, that would never have been realized, if the property were to have remained run down.