Tesla's $1.3 Billion Incentive Deal with Nevada

CommanderFrank

CommanderFrank

Cat Can't Scratch It
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If you were wondering exactly why Tesla Motors chose to build its ‘Gigafactory’ in Nevada over other states that were willing to give even bigger tax breaks, the answer is simple: uncontested direct sales to the public.

Lawmakers in a special session also exempted Tesla from a law requiring new cars to be sold through dealers, and reduced tax breaks for filmmakers and insurance companies to do business in Nevada
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So how does a decision like this get recorded? Somewhere in the law books it will say a specific company is exempted from following a specific law? What's the point of having a law in the first place if not everyone has to follow it?
 
the_servicer said:
So how does a decision like this get recorded? Somewhere in the law books it will say a specific company is exempted from following a specific law? What's the point of having a law in the first place if not everyone has to follow it?
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If you have enough $, silly things like laws and regulations don't apply to you.
 
the_servicer said:
So how does a decision like this get recorded? Somewhere in the law books it will say a specific company is exempted from following a specific law? What's the point of having a law in the first place if not everyone has to follow it?
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When you have the right leverage, the right amount of money, or the right thing someone desperately needs, people are willing to look the other way, provided you keep your end of the deal.
 
the_servicer said:
So how does a decision like this get recorded? Somewhere in the law books it will say a specific company is exempted from following a specific law? What's the point of having a law in the first place if not everyone has to follow it?
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You got something that can massively change the GDP of a state, you have a number of states you're interested in using as the location, the states compete.

A state's options are to offer a temporary incentive such as, in this case, Tax breaks on currently barren land with little value, in exchange for a 20% increase in future GDP and a ton of jobs... or the other state does it.

Free market on a larger scale. Imaginary tax loss is kinda like imaginary piracy losses, hard to quantify. But thousands of high paying jobs and billions in future taxes in Nevada vs Texas is easier to put a value on.
 
Wierdo said:
You got something that can massively change the GDP of a state, you have a number of states you're interested in using as the location, the states compete.

A state's options are to offer a temporary incentive such as, in this case, Tax breaks on currently barren land with little value, in exchange for a 20% increase in future GDP and a ton of jobs... or the other state does it.

Free market on a larger scale. Imaginary tax loss is kinda like imaginary piracy losses, hard to quantify. But thousands of high paying jobs and billions in future taxes in Nevada vs Texas is easier to put a value on.
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Texas, being cash plus from gas prices the rest of us pay for have been great at 'attracting new businesses' this way. Irony they get to screw the rest of the country twice kind of piggish. If the price of gas crashes, Texas will have all these businesses with subsidized deals to provide services for and not enough oil income to pay for it. Really not in their interest to do what they are doing.
 
jpm100 said:
Texas, being cash plus from gas prices the rest of us pay for have been great at 'attracting new businesses' this way. Irony they get to screw the rest of the country twice kind of piggish. If the price of gas crashes, Texas will have all these businesses with subsidized deals to provide services for and not enough oil income to pay for it. Really not in their interest to do what they are doing.
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I'm sure there's many ways a state can make bad deals - or rather deals that are good for select few. If Tesla's tax break was not temporary and the short-term return on investment didn't dwarf the expense by an order of magnitude for Nevada then I'd be against it as well.

You're not gonna find me in disagreement on the gas subsidies angle, that's a major mess.
 
The laws requiring the dealership models are obviously total bullshit in the first place, and nothing more than the result of decades of secret handshakes and under-the-table envelopes full of cash. Tesla knows it, and so they offered the state a better deal than the dealerships could.
 
McFry said:
The laws requiring the dealership models are obviously total bullshit in the first place, and nothing more than the result of decades of secret handshakes and under-the-table envelopes full of cash. Tesla knows it, and so they offered the state a better deal than the dealerships could.
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Yup yup. The car dealership gravy train is very strong. Hopefully companies like Tesla can overcome this. The resistance in lots of states from the car dealers is huge.
 
and reduced tax breaks for filmmakers and insurance companies to do business in Nevada
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why is part of their deal.. reduced tax breaks for filmmakers and insurance companies. that seems odd
 
fine by me, an american company building cars IN AMERICA can have all the tax breaks they want, screw all the other companies that build over seas.
 
Nookie420 said:
fine by me, an american company building cars IN AMERICA can have all the tax breaks they want, screw all the other companies that build over seas.
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Lol.. it is partially assembled in the us. Reality is it is as much built overseas as any Toyota.
 
Dekoth-E- said:
Lol.. it is partially assembled in the us. Reality is it is as much built overseas as any Toyota.
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Except not really. Once the gigafactory is online, 90% of the Model S' parts will be American made (at least according to the company).
 
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