Corporate Tax

This week in Head Scratchers: Bezos helps a corporate tax fee hike?

Amazon founder Jeff Bezos announced support for President Biden’s focus on “making bold investments in American infrastructure.”

And here was the surprising part: Bezos added, “We support a corporate tax rate hike” to aid pay.

The announcement had people scratching their heads; Bezos has never been a huge fan of paying a lot of taxes.

So what’s up?

The president plans to pay for roughly $ 2 trillion in infrastructure – roads, bridges, electric charging stations, broadband, and more – in part by increasing the corporate tax rate from 21 percent to 28 percent.

In his speech announcing the big project, Biden highlighted Amazon as a company that has to pay more taxes.

“Many tech companies, including Amazon, have long had a fun, technocratic, almost libertarian relationship with the government,” says KUOW policy reporter David Hyde, adding that these companies are unwilling to pay taxes to a government they see as bad efficient problem solving.

“Some people may see this as a sign that Jeff Bezos and Amazon are beginning to mature in their relationship with the government, as Microsoft has done.”

Like it or not, Bezos and his company need to work with the government.

“So you can use it to your advantage as well as possible,” says Hyde. “It may also be that Amazon just isn’t that concerned about corporate taxes because it has found so many ways not to pay them.”

Margaret O’Mara is Professor of History at the University of Washington and author of The Code: Silicon Valley and the Remaking of America. And she pointed out how Amazon can and does avoid taxes.

For one thing: Amazon invests a large part of its earnings back into the company, thus reducing the amounts ultimately paid in corporate taxes. And the same investment can qualify for tax credits.

There’s also a theory that such a tax hike would likely hurt more of Amazon’s competitors like Walmart.

Then there is the public image of Amazon and Bezos.

“It’s a great way to change the subject of union votes in Alabama and Amazon employees have to urinate in bottles,” said Joni Balter, host of Civic Cocktail on the Seattle Channel.

Amazon warehouse workers at a Bessemer, Alabama facility will not form a union. The union vote Balter was referring to was called on Friday morning in favor of Amazon.

The majority of Amazon employees voted against joining the retail, wholesale and department store union. The final balance was 1,798 votes against union formation versus 738 votes in favor of union formation.

That means Amazon has withstood the biggest union surge among its US workers to date and has avoided the prospect of its first unionized warehouse in America. Around 5,800 people work in the Amazonas plant in Bessemer and 3,215 cast ballots in the elections.

The union is now filing a legal lawsuit against the election and indicting unfair labor practices against Amazon. A hearing by the National Labor Relations Board is requested “to determine whether the election results should be overturned because the employer’s behavior creates an atmosphere of confusion, coercion and / or fear of reprisals and thus freedom for workers impaired. ” of your choice. “

The company argued the union was only interested in collecting the workers’ hard-earned cash in fees, while Amazon was already paying well above the local minimum wage, providing generous health care and other benefits.

Rebecca Givan, a professor of labor studies at Rutgers University, told NPR the vote could lead Biden and other US officials to reconsider laws that will bring great benefits to employers, including the freedom “to bombard their employees with anti-union messages “.

Regarding the Biden administration, Balter speculates that Bezos’ support for a corporate tax hike could be of strategic importance: “Amazon may be willing to make a small donation at the beginning of this process to get on Joe Biden’s good side, while he thinks about it, the corporate tax hike isn’t going to go up to Biden’s full 28 percent, “she says. “Maybe it’s 24 or 25 percent.”

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Perhaps the most important point to consider is simple: Amazon relies on the country’s infrastructure to do business to the extent that they do.

“Delivery drivers drive all day on roads and bridges. And don’t forget, Amazon is investing heavily in electric vehicles. This package will supposedly contain many charging stations for electric vehicles,” notes Balter. Basically, improved infrastructure means Amazon can continue to make same-day deliveries, which is attracting so many repeat customers.

The details of which specific projects would be funded under Biden’s plan are not yet known – much like the fate of the proposal itself, as members of Biden’s own party withhold its preferential tax hike.

But almost everywhere you look, there is plenty of room for improvement.

In the testimony to America’s infrastructure that

The American Society of Civil Engineers publishes an annual report for American infrastructure, and Washington State received a C for 2021.

The report also identified 399 bridges in this condition, which are considered to be structurally defective. that’s since last year.

Balter and Hyde spoke to KUOW’s Angela King about the week in politics. Listen to the conversation by clicking the audio above.

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