On Tuesday, Amazon, Inc. announced plans to build a 1 million-square-foot warehouse in Southeast Baltimore. Government incentives, of course, came along with the plans projected to create 1,000 jobs. According to the Baltimore Business Journal, the Maryland Department of Business and Economic Development will provide Amazon with a $1.25 million conditional loan, and the company is also eligible for a number of tax credits for creating jobs. Because the project is located inside a state Enterprise Zone, Amazon will receive a tax break for five years, which then declines by 10 percent annually. In addition, projects located within an Enterprise Zone also receive a $1,000 credit for every new employee hired, and Amazon is eligible for a tax credit for every permanent full-time employee it hires paying at 150 percent of the minimum wage.
Some Maryland residents are unhappy with Amazon’s plans, however, because along with the new distribution center comes a 6 percent sales tax for every Amazon purchase a Maryland resident makes, regardless of where it’s shipped from. Although it’s difficult to project, Maryland Retailers Association President Patrick Donoho told the Baltimore Business Journal that he thinks the state sales tax collected on Amazon purchases will help boost tax revenue. The Maryland Comptroller’s Office estimated in 2011 the state loses $200 million annually on purchases from online shops and catalogs.