On Kansas border, impact of new tax cuts is still foggy

[pstokely]

http://www.stltoday.com/business/local/on-kansas-border-impact-of-new-tax-cuts-is-still/article_3f66af44-3f63-56d7-b0b7-9f776aae75a8.html
"The five-story granite and glass building is set to be the new home of Teva Neuroscience, a growing drug maker that promises to bring 400 new jobs to Overland Park. For this, Teva is receiving a bevy of tax breaks and other incentives, including $31 million from the state of Kansas.

The building is set to be done in October, when Teva will move there and leave behind empty offices four miles away in south Kansas City, Mo.

Teva is hardly the first firm to receive incentives to jump the state line that splits Kansas City. A so-called economic development “border war” has simmered here for years, with dozens of companies receiving rich packages to move jobs to the other state.

But at the start of this year, Kansas unsheathed a powerful new weapon in the jobs arms race, lowering its personal income tax and eliminating taxes paid by many small business owners.

Kansas Gov. Sam Brownback has touted the plan as a bold experiment, designed to jump-start Kansas’ long-sluggish economy. And that has kicked off a hot debate about whether Missouri should follow suit, by answering with tax cuts of its own that will ripple a long way from Kansas City."

[RC]

1. Kansas is headed for bankruptcy.

Giving new meaning to "Red State" (government red ink)

[pscot]

2. Somalia is a bold experiment too

But nobody wants to live there.

[Vincardog]

3. Why do you want companies that pay no taxes? Do they just like added congestion and demand

on government services?

[Igel]

4. I guess the reasoning is that you get employees who do pay taxes.

Not state income tax, of course. It's just a joke that "Texas" is an anagram for "taxes".

400 employees, each paying $4k in various taxes per year ... $1.6 million. Plus the knock-on effect of increased demand (we like the multiplier when it's one kind of spending, not so much when it's another) ... perhaps they'll break even in a few years. Unless the workers live in Kansas

[Vincardog]

5. including $31 million from the state of Kansas. 31/1.6 = How many years?