As the old fable about the ant and the grasshopper teaches us, fall is a time to look ahead. Where the ant diligently saves food for the winter, the grasshopper spends his days enjoying life, living in the moment. When the harsh winter comes, the ant is prepared while the grasshopper is left out in the cold. Metaphorically speaking, the same can be said about tax credits and incentives, unfortunately no one can agree on who is the ant and who is the grasshopper.
Over the last several days, a number of state and local tax awards have been announced. These awards cover everything from billion-dollar businesses to famous tourist attractions.
Massachusetts recently awarded $2.5 million in tax incentives to IBM in exchange for locating an operations center in the state, as reported by Martha Kessler, in Bloomberg BNA’s Daily Tax Report. However, this award has received mixed reviews, since some believe IBM would have come to the same conclusion to locate in Massachusetts regardless, as noted in The Boston Globe.
Ohio has also gotten into the credit and incentive game, according to a Sept. 28, article in The Columbus Dispatch. Recently, the state announced eight projects that will be receiving tax incentives. Ohio is expecting these projects to create over 2,000 jobs in the state, the article notes.
That brings us to the King of Rock and Roll. As discussed at length in Pulp Fiction, there are two kinds of people in this world those who like Elvis and those who like the Beatles. Well, it looks as though the state of Tennessee and specifically the city of Memphis are squarely in the Elvis camp. Recently, it was announced that Graceland, the King’s former home and major tourist destination, will be undergoing some changes, the cost of which will be subsidized through tax breaks at both the state and local level, according to an Oct. 5 article in The Wall Street Journal.
Illinois has also been in the news for their tax credits and incentives, however it hasn’t been to announce recent awards. The Chicago Tribune recently did an in-depth study of the state’s EDGE tax credit program, and concluded that the program was not quite what it was made out to be. A number of companies have found ways to receive program credits while failing to create jobs in the state, according to the article.
The fall is a busy season for many, ants and grasshoppers included. Yet, even as the calendar year begins the long process of winding down the state tax incentive world seems to be firing up.
*Continue the discussion on Bloomberg BNA's State Tax Group on LinkedIn: Will these tax credits and incentives help their states create jobs?
For more information about relocation and expansion tax credits, check out Bloomberg BNA’s Credits and Incentives Portfolios by signing up for a free trial of the Bloomberg BNA Premier State Tax Library today.
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