- Amazon has won $US669 ($AU918) million in tax breaks since the beginning of this year, watchdog data shows.
- These incentives, from local and state governments, are mostly to encourage Amazon to expand delivery locally.
- One county official said Amazon acted in bad faith when it won $US150 ($AU206) million in incentives.
- See more stories on Insider’s business page.
Amazon has won more tax incentives from local and state US authorities to expand its delivery network in 2021 than ever before, according to data gathered by economic development watchdog Good Jobs First and reported by The Financial Times.
Per Good Jobs First’s data, Amazon has won at least $US669 ($AU918) million in subsidies from local and state governments since the beginning of 2021. All the subsidies were to help the retail giant build out its one-day or same-day delivery networks locally, except for $US21 ($AU29) million tax credits for the company’s filming division Amazon Studios.
Per The FT, this is the most tax incentives Amazon has won in any single calendar year to expand its delivery network since Good Jobs First started collecting the data in 2000.
The watchdog estimated that Amazon had received at least $US4.1 ($AU6) billion in incentives since 2000. Amazon received $US750 ($AU1,029) million in 2019 to build its new headquarters in Arlington, Virginia.
Kasia Tarczynska, research analyst at Good Jobs First, told the FT she had hoped the economic impact of the pandemic would mean local authorities spending less money enticing big companies like Amazon into their areas.
“I was hopeful public officials would step back and say: ‘We’re in such a difficult situation, we have to stop subsidizing very wealthy companies’,” Tarczynska said, adding, “Unfortunately, it’s the opposite.”
Tarczynska also said Amazon should stop pursuing incentives.
Jay Popli, a board member for Monroe County, New York, told the FT that Amazon had acted in bad faith when it obtained $US150 ($AU206) million in incentives over 15 years from the county in April this year.
Part of the deal was that Amazon would only hire local workers from nine nearby counties to construct the new project, Popli said. Amazon agreed, but after the incentive was granted, it pushed for a waiver saying it wasn’t possible to comply with the provision while completing the project on schedule, Popli told the FT.
“It was just not a good-faith effort,” Popli told the FT. Amazon declined to comment on its deal with Monroe County when contacted by the FT.
Amazon acknowledged to the FT that it had gone ahead with a recent plan in Fort Wayne, Indiana, despite officials denying it an additional $US7.3 ($AU10) million in tax incentives.
Amazon did not immediately reply when contacted by Insider for comment on the data, but in a statement to the FT, an Amazon spokesperson said it was eligible for tax incentives.
“These incentives are typically available to any firm that meets the criteria and companies do not receive a penny until after they have created jobs and made capital investments,” the spokesperson said.
“In 2020 alone, Amazon invested $US150 ($AU206) billion in the US, opened more than 100 sites and created more than 400,000 jobs across more than 40 states,” they added.
Amazon has been criticized in the past for its dealings with state governments. In September 2017, the company started courting local governments with the offer of building its second headquarters, HQ2. In November 2018, it picked two sites, Queens, New York, and Arlington, Virginia – but canceled its plans for HQ2 in New York in February 2019.