Wednesday, June 3, 2009

Has North Carolina handed out an unfair tax break?

The problem with targeted tax breaks? They apply only to the favored few companies that government thinks will win out in the marketplace.

Charlotte Observer: Apple to build computer data center in North Carolina

Apple will come to North Carolina, investing $1 billion in a computer data center over nine years.

Gov. Beverly Perdue announced the expansion this afternoon after signing legislation that will cut the California company’s tax bill in North Carolina by about $46 million over a decade. Legislators moved rapidly last month to approve the measure, which changes the way corporate income taxes are calculated for a capital-intensive business like Apple. It is expected to be the only company that will benefit.

“North Carolina continues to be a prime location for growing and expanding global technology companies,” Perdue wrote in a statement. “We welcome Apple to North Carolina and look forward to working with the company as it begins providing a significant economic boost to local communities and the state.”

The data center is expected to have at least 50 full-time employees, although another 250 contractors could be employed to manage security, landscaping and heating and air conditioning systems. Including construction jobs, the presence of the facility could put a total of 3,000 people to work, according to Department of Commerce estimates.
The best tax system is comprised of a low rate with few or no exemptions.

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