New York, Sales Tax Exemptions, and Economic Growth
- Mar 18, 2013 | Gail Cole
The Saratoga County Industrial Development Agency (SCIDA) in New York has approved “$387 million in new sales-tax exemptions on the construction of a new research center in Saratoga County and a potential second computer chip manufacturing plant.” (The Business Review).
In doing so, SCIDA is fulfilling its mission statement “to promote, develop, encourage and assist in the construction, expansion, and equipping of economically sound industrial and commercial facilities in order to advance the job opportunities, general prosperity, and economic welfare of the citizens of Saratoga County.”
The new research center is for Global Foundries, a company that is on its way to become “the first truly global semiconductor foundry.” According to The Business Review, Global Foundries is expected to employ approximately 1,000 at the new plant by the end of 2014. The company already employs 2,000 people at its plant in Malta, New York. Construction of the plant alone is expected to employ some 1,000 construction workers each day.
Governor Andrew Cuomo would like to prevent industrial development agencies (IDA) like SCIDA from granting state sales tax exemptions “as they see fit….” Communities use sales tax exemptions to “attract new jobs and economic development projects.” The governor would like to “require IDAs to seek permission from the state before granting tax exemptions.”
Would Global Foundries opt to expand elsewhere without the enticement of sales tax exemptions? Charles Hanehan, a dairy farmer on the Saratoga town board, thinks not. He voted against the exemptions “because of how much towns rely on sales taxes to generate revenue.” (The Business Review).
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