Sun
May 8 2011
04:47 pm
Amazon May Up the Ante: Knoxville, Nashville
By: onetahiti

Amazon may build three more distribution centers in Knoxville and Nashville, bringing its proposed investment to $319 million and creating "about 1,700 full-time workers and 2,000 part-time or seasonal workers within two years" ((link...)) in addition to the thousands of jobs already slated for Chattanooga.

Tennessee would get all these greatly needed long-term economic benefits, but only if lawmakers decide to view the non-retail distribution centers--incorporated separately from Amazon--as not constituting an Amazon nexus.

We can't afford not to take the deal. As for the folks who worry about charging more sales tax, their time may come anyway, at the federal level, soon enough.

The Chattanooga Times Free Press has the story ((link...)).

-- OneTahiti

Topics:

Funny that they say the MAY

Submitted by WhitesCreek on May 8, 2011 - 4:53pm.

Funny that they say the MAY locate two new distribution centers in the legislative districts that just happen to be the sponsors of legislation forcing Amazon to pay sales tax. Very fishy.

Amazon will benefit!

Submitted by randmart on May 8, 2011 - 9:45pm.

There's no question about that. If they are using the possible addition of more distribution warehouses as a bargaining chip, why is that fishy? Businesses considering opening facilities in virtually every state do the same thing every day. Do you believe that VW built a plant in Chattanooga because they like the view? Refusal to make concessions to businesses is one of the prime reasons many have passed up Roane county.

WC

Submitted by onetahiti on May 8, 2011 - 8:21pm.

What seems "fishy" to me is the current administration trying to go back on the agreement already in place from the previous administration.

-- OneTahiti

The problem seems to be that

Submitted by WhitesCreek on May 9, 2011 - 6:27am.

The problem seems to be that Tennessee law is very explicit in defining the operation that Amazon is building as one which is required to collect sales tax. Even Governor Bredesen can't break the law. Now we see Amazon playing political hardball to evade taxes. It's the American way now that we are run by corporations.

Job Creation

Submitted by romanstone on May 9, 2011 - 8:25am.

S.C. are in the same talks with Amazon and their legislators. Link

Given our economic times, the creation of local jobs is vital. Please keep in mind that this is new work coming into the State. Those newly created jobs have a multiplying affect as they will support the additional need for service/support jobs.

While inhearently not fair to local businesses, these big boys offer something we need - local jobs and investment. This rolls over economicly by offering our existing local businesses increased demand (i.e. sales) that can translate into increased hiring. Increased sales from the local businesses translates into increased sales tax and revenue for the State government.

Yes, Amazon will benefit greatly. The 9.5% sales tax savings may, in fact, be larger than most small businesses' profit margins.

It is difficult to know the right approach when it comes to incentive packages. This deal may actually be worth it. If structured correctly, say a 5 year tax abatement, then it would help off set their initial investment and allow the State to collect their long term sales taxes.

I hear the arguments. What

Submitted by WhitesCreek on May 9, 2011 - 11:24am.

I hear the arguments. What we haven't seen is any study that tells us whether the "new" jobs come at the expense of the "old" jobs. Unless TN's economy kicks in the pie that Amazon is carving itself a piece of hasn't grown. In fact the net jobs outlook with Amazon could be a net loss across the entire state, since smaller distribution jobs and retail floor space would be lost as well. I think we're being suckered here. It's time for our elected federal officials to step up and make collecting local taxes universal at the point of delivery. You sell something in Tennessee, you pay the taxes and fees like everybody else. Other wise you're stealing.

WC

Submitted by onetahiti on May 9, 2011 - 1:25pm.

Please give any figures that would show that "smaller distribution jobs and retail floor space would be lost." From where I sit all those added jobs would help business as the newly employed spend their paychecks.

I agree with you when you write, "It's time for our elected federal officials to step up and make collecting local taxes universal at the point of delivery."

In the meantime, let's grab those jobs and over $300 million in contracts and investment. The U.S. Congress will act on this soon enough.

I've been watching Amazon--and Wal-Mart--for a long time. I don't think I'm the one being "hoodwinked" here.

Again, we must agree to see those separately-incorporated distribution centers as not constituting a "nexus" for Amazon. If we don't, goodbye to all those hundreds of millions and all those relatively clean jobs, because Amazon will go to another state and still won't be collecting taxes here. They've done it before.

If the TN government can't see that, then they don't deserve those nice jobs and investment. It's too bad that innocent jobseekers and the local businesses who could have served them will be harmed too.

Yee-hah.

-- OneTahiti

I can't show you the numbers

Submitted by WhitesCreek on May 9, 2011 - 1:55pm.

I can't show you the numbers because interestingly enough no study has been done that determines the effect of Amazon on the local retailers. Odd that. I can show you a bunch of empty retail buildings in every single one of our towns. This can't possibly help.

WC

Submitted by onetahiti on May 9, 2011 - 4:20pm.

Of course all the new investment, new state of the art buildings, and new jobs will help. Listen to yourself!

You have yet to name one local retail business that will be hurt by Amazon having marginally faster or less expensive delivery in Tennessee. And many local businesses will be helped by the contracts and by all those new employees spending their paychecks.

-- OneTahiti

Don't be silly...

Submitted by WhitesCreek on May 9, 2011 - 4:45pm.

WalMart, Best Buy, Radio Shack, and so on.

WC

Submitted by onetahiti on May 9, 2011 - 7:06pm.

Wal-Mart is local?

And these three will go out of business if Amazon has marginally faster shipping? I do not believe it.

-- OneTahiti

Local consumers that buy

Submitted by romanstone on May 10, 2011 - 11:10am.

Local consumers that buy from Amazon will not see the difference. If they are currently buying from Amazon, then they will continue doing so. I don't see how having Amazon's distribution centers in Tennessee would change their buying patters. Tennessee is a very logical location for distribution centers, as we are a days drive to a majority of the US population, hence FexEx's strategic location.

Competition

Submitted by Rockwood Lawyer on May 9, 2011 - 5:31pm.

I think the competition issue is not whether local businesses are hurt by Amazon having slightly faster shipping. The issue is local business having to collect sales tax while Amazon does not. Amazon has always legally skirted tax collection (consumers who buy on the Internet still may owe TN use tax) by claiming that they don't have a presence in Tennessee. Now Amazon wants to have facilities in Tennessee and still not collect tax.

Use Tax Reporting

Submitted by Rockwood Lawyer on May 9, 2011 - 5:41pm.

Maybe the State can cut a deal: Amazon can get their special deal, and won't have to collect tax, but in exchange they will turn over to the State their list for the past, present and future of who in TN they sold to and how much so that the State can itself collect the use tax owed. How many people would owe? How many people would switch back to local shopping?

Tennesseeans for Fair Taxation has some more explanation.

Oooooooo!

Submitted by WhitesCreek on May 9, 2011 - 6:30pm.

I like that!

WC

Submitted by onetahiti on May 9, 2011 - 7:19pm.

You never disclosed your financial interest in this issue one way or another. You seem to so passionately argue Wal-Mart's and the Republicans' case. Why not disclose? :)

-- OneTahiti

My chips are off the table...

Submitted by WhitesCreek on May 9, 2011 - 7:57pm.

I have no financial interest in this one way or another. Personally, I wish WalMart would disappear from the face of the earth. It's the example you asked for.

Now back atcha...why do you want Amazon to be exempt from taxation in TN? What's fair about that?

WC

Submitted by onetahiti on May 10, 2011 - 12:43am.

Until federal law is changed, I want all out-of-state companies to not collect tax on Internet purchases shipped to Tennessee.

Why do you want to single Amazon out? :)

To me, the real issue is whether we want those new jobs and new contracts and investment. Amazon simply can't be forced to invest here by saying that if they do, they have to collect the tax. So, it is jobs and investment, or nothing.

The taxation issue will be taken care of soon enough at the federal level. Meanwhile, we could reap all those benefits.

-- OneTahiti

Amazon is not shipping to

Submitted by WhitesCreek on May 10, 2011 - 5:54am.

Amazon is not shipping to Tennessee, they are establishing a presence here with a warehouse and a fulfillment center. By doing this they are placing a burden on the systems and services that are paid for by sales taxes. They've stepped over the line from warehousing and shipping into our state from outside to establishing a nexus inside Tennessee from which they warehouse products and ship to orders.

If we don't tax them, we could well have to stop tax collections on many other businesses. Tax abatement in whatever form is a loser for Tennesseans. This is silly.

Not retroactive, but future

Submitted by onetahiti on May 10, 2011 - 3:50am.

Making it retroactive is unfair.

I would rather just pay the taxes at the time of the sale.

But that isn't going to happen unless it is done at the federal level.

Wouldn't all those other Internet businesses--and local brick-and mortar businesses too--gain an unfair advantage over Amazon if the law were written to make only Amazon subject their customers to a lot of extra paperwork?

All in all it would be easier just to have all companies everywhere collect the sales tax. Better yet, we should move to a less regressive tax. That would really help local businesses and state tax coffers. Think of all those cross-border shoppers in Chattanooga and elsewhere.

-- OneTahiti

Amazon Virtual Hiring Event - Knox/Chattanooga

Submitted by romanstone on May 10, 2011 - 12:02pm.

Publicity stunt or real opportunities?

Every Wednesday from 11:00AM-2:00 PM

We are looking for Area Managers, Operations Managers, and Senior Operations Managers to Relocate and support one of our networks of Fulfillment Centers in the Chattanooga, TN Area

RELOCATION OFFERED FOR QUALIFIED CANDIDATES
Please join us in learning about one of the fastest growing retailers in the world. To get there, we need exceptionally talented, bright and driven people.

Amazon is seeking Managers for our Fulfillment Centers throughout the United States. Amazon is one of the most recognizable brand names in the world and we distribute millions of products each year to our loyal customers.

(link...)

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