Local reps: Amazon deal too good to pass up

In the end, said S.C. Rep. Tom Young, R-Aiken, Amazon's sweetened deal of more jobs, higher pay and a larger investment was too good to pass up.

Earlier this week, House members reversed their original vote that rejected Amazon's plan to bring a distribution center to Lexington County. The legislation, which approved a five-year sales tax exemption for Amazon, must still get S.C. Senate approval and Gov. Nikki Hale's signature.

All Aiken County Legislative Delegation House members agreed to give Amazon the exemption in a vote Tuesday.

The sticking point had been the company's refusal to collect sales taxes on in-state purchases. By a 41-27 vote, House members previously said no, citing the unfair advantage that Amazon could have over existing business within South Carolina.

Since then, lawmakers have gotten a lot of new information, said Young. The online store QVC was given the exemption in 2005 and kept it for several years. More than 10,000 small businesses in the state do business through the Amazon website. Federal law doesn't require them to collect sales taxes.

A key issue, Young said, is that Amazon got the promise of a sales tax exemption from state officials from the Sanford administration months ago before current Gov. Nikki Haley took office. That factor prompted Commerce Secretary Bobby Hitt to give the new deal his lukewarm endorsement.

"We learned that Georgia, North Carolina, Tennessee and Alabama (officials) are giving the perception that South Carolina had backed out of a promise," Young said. "They're using that against us."

Amazon bumped up its original guarantees significantly, said S.C. Rep. Roland Smith, R-Warrenville. The online giant is promising 2,000 jobs at about $17 an hour, plus 401Ks and health insurance. The minimum capital investment will be $125 million.

"It's quite obvious we need the 2,000 jobs," Smith said. "We got calls from economic development officials across the state to see what we could to do improve the situation."

S.C. Rep. Bill Clyburn, D-Aiken, supported the Amazon deal from the start.

"I didn't see where we could lose anything in the way of taxes," he said. "These people could just do their business elsewhere. I feel it's a win for South Carolina."

In an emailed newsletter, S.C. Rep. Bill Taylor, R-Aiken, said the situation doesn't fix the need for long-term tax reform. Jobs, however, have to be the priority.

"If the incentives were not approved, Amazon would still never pay sales tax in S.C. and will still be selling items to people in our state, but Amazon would not provide the 2,000-plus jobs to our citizens," Taylor wrote. "This bill means Amazon will begin paying sales tax in 2016 - which actually puts Amazon on a track toward leveling the playing field with other businesses in our state."

Contact Rob Novit at rnovit@aikenstandard.com.