Virginia To Tap Online Sales Tax For Amazon Incentive Payments

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.”

Click here to read the rest of the article written by Jonathan Capriel over at the Washington Business Journal

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