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S.C. legislators approve deal for Amazon

Sales tax collection exemption now goes to Gov. Haley, who won't oppose it.

By Tim Flach
tflach@thestate.com

COLUMBIA Amazon received the green light from the legislature on Wednesday for a sales tax collection exemption, a decision allowing the online retailer to open a distribution center bringing 2,000 jobs to the Midlands by the end of 2013.

House members signed off on the step 90-14, the final hurdle for the proposal in the General Assembly. This second House approval was required to accept minor changes made by the Senate last week.

The measure now heads to Gov. Nikki Haley, though "nothing has changed" in her plan to let the measure take effect without her approval, spokesman Rob Godfrey said.

Work on the $125 million center near Cayce is set to resume once the tax break is on the books, likely by late next week. The new center off I-77 near 12th Street will be the Midlands' largest development in recent years.

Officials of Seattle-based Amazon could not be reached for comment

Final approval came five weeks after the proposal appeared dead when state representatives initially rejected it April 27.

Its revival capped a comeback encouraged by area business leaders shocked at the loss of the promised payroll and concerned that such a decision could discourage other companies from considering South Carolina for expansion.

"It's an opportunity we couldn't afford to pass up," said Scott Adams of Lexington, a telecommunications equipment executive who helped lead a loose-knit coalition of political and business leaders promoting the proposal.

"Bringing jobs that can get people off unemployment is what it is all about," Adams said. "It's also the start of good things that Amazon can do for our region and our state."

Some retailers who fought the proposal say Amazon was too big to resist, especially after it all but shut down work on the center and then increased the payroll promised from 1,249 to 2,000.

"They had a pretty good game plan," said Brian Flynn, executive director of the South Carolina Alliance for Main Street Fairness. "And with this economy, they were in a good position to strong-arm legislators."

His group is a mix of small merchants and national chains, bankrolled by large retailers.

The tea party wing of Republicans and other conservative groups also complained the proposal was a sweetheart favor.

Amazon is getting a five-year exemption from collecting sales taxes on purchases by South Carolina residents.

It agreed to notify customers that taxes are due on sales, but doesn't have to tell state revenue officials who bought how much. Buyers of goods online are supposed to pay taxes themselves but few do, officials say.

The tax loss from the exemption initially is estimated at $2.5 million yearly, but supporters say state and local coffers will net at least $11 million annually from payroll and property taxes the center will generate.


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