Virginia could start squirreling away money to pay Amazon.com Inc. (NASDAQ: AMZN) as early as July 2020 — and its first $40 million in payments could come from the state’s internet sales tax revenue, according to the budget proposal set to come before the governor.
That figure is only a fraction of what the state would pay to the Seattle e-commerce giant in the next dozen years, so long as Amazon creates a required number of jobs as part of its HQ2 campus in Arlington. But the state budget — which the General Assembly passed Feb. 24 and is awaiting the governor’s signature — calls for setting aside $40 million collected from state taxes on online purchases each fiscal year to help fund the Amazon incentive payments.
Legislators say this ensures the state can pay Amazon at a steady pace in the instance of an economic downturn. Plus, Virginia would be ready if Amazon started to staff up earlier than expected, said Virginia Del. Chris Jones, R-Suffolk, the House Appropriations chairman,during a legislative session Sunday when he introduced the budget.
“For us, it was very important because [Amazon] could ramp up the jobs in a hurry,” he said. “We have lived through at least three downturns where we had to cut when we did not want to cut.”