Job Stimulus by Any Other Name

Today in the newspaper I saw an article about a proposal to raise the tax rebate incentive the film industry receives from the State of Utah from 20% to as much as 30%. I find this interesting.

What are the reasons for luring film makers to Utah? The jobs they provide are of course temporary and the tax revenue that they generate is a little fuzzy. If we are offering the incentives because we like to see ourselves in the movies, I question the move.

This isn't the only instance of corporate tax relief. The deal that Adobe got for locating in Lehi amounts to $40 million in tax relief over the next 20 years, with $17.5 million for area improvements and infrastructure over the same period. There was general celebration at the State Capitol at the announcement that Adobe was coming.

I hope that the investment of these funds does provide jobs for local workers and that it helps stimulate the economy. I would like to point out, however, that this is equivalent to a "jobs stimulus bill". The difference is the agreement to rebate future tax dollars, instead of appropriating the funds from current taxes and sending it out to existing businesses which are struggling.

I hear that over 80% of the jobs in Utah are in the small business sector. The state budget will be challenged to make ends meet again this year so the individual tax payers and the small businesses will carry the tax burden for the big businesses as they enjoy their rebates.

The Republican Party message often includes bashing the bills coming out of Congress meant to stimulate job growth. They refer to this as "tax and spend" and question the effectiveness of these efforts. However, this is little different from the corporate tax breaks they are applauding.

Will we see campaign contributions from the film industry and new-comer businesses such as Adobe, in gratitude for their financial boost courtesy of the Utah taxpayers? You can bet on it.