Quote:
Originally Posted by whell
At least here in MI the practice has been "managed" to a great extent. A community must petition the state legislature to creat the zone, and if approved, favorable tax treatment is bestowed by local and state government. A zone is only created if it is deemed in the best intetest of many stakeholders, public and private. In this manner, the issue you've cited is not avoided, but reduced or controlled.
However, I'm still wondering why an "across the board" reduction in taxes - yes, for business and capital gains taxes - would or would not have a similar positive impact.
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Wouldn't one answer be that, as you mentioned, the tax abatements are carefully targeted to areas where there otherwise would not be investment. It is presumed that there are plenty of areas where the infrastructure and other market conditions make investment a reasonable business proposition without a subsidy. Bottom line is that we really can't afford to subsidize business across the board, any more than we already do with the investment in infrastructure, police and fire protection, and education.
Regards,
D-Ray