Amazon secures giant tax breaks despite record profits and questionable labor practices

Regional governments are still eager to court Amazon’s business despite uncertain economies and Amazon’s own practices. According to the Financial Times, the economic watchdog Good Jobs First has determined that Amazon has so far received about $650 million in local and state tax incentives in 2021 to build out its next-day and same-day delivery operations. That’s a record for the company, and comes close to the $750 million Amazon received to build its second headquarters.

The largest incentive was a $322 million, 12-year property tax abatement pending in Markham, Illinois, followed by a nearly $151 million, 15-year tax exemption package in Monroe County, New York. Good Jobs First said this was likely a cautious estimate as some of the deals involve undisclosed tax deals and grants.

The payouts came despite an uncertain economy and complaints about Amazon’s working conditions, including modest pay, strict monitoring and high injury rates. Officials may attract more jobs to their area, but they won’t necessarily be high-quality jobs that grow the economy. It’s also unclear if there’s a net job benefit — FT cited an Economic Policy Institute study showing that an Amazon warehouse attracted workers from other companies rather than expanding the overall workforce.

Amazon has justified the incentives through overall job creation and economic investment. In a statement, the company said it created over 400,000 jobs in 2020 alongside a $150 billion investment. It added that it was often taking incentives available to any company settling into a given location, not just Amazon.

Even if there is an overall employment increase, though, the question is whether or not Amazon should be accepting tax incentives in the first place. The company made more profit in the first year of the pandemic than it did in the previous three years, raking in $26.9 billion. The firm doesn’t exactly need those tax breaks to survive, and the money could be used to improve communities and working conditions.