Amazon ups ante, so House says yes: Online retailer would get 5-year sales tax exemption

Wendell Gilliard

LEROY BURNELL

COLUMBIA -- South Carolina legislators voted Wednesday to welcome Amazon.com to the state with a sales tax exemption, after the online retailer upped the ante of jobs and investment.

The House voted 97-20 to give Amazon a five-year exemption from collecting sales taxes from online shoppers in South Carolina. The vote comes three weeks after the chamber voted 71-47 to reject the deal.

The online retailer sweetened the pot before the re-vote. To get the exemption, the company must create at least 2,000 local, full-time jobs with health benefits and invest $125 million by the end of 2013.

That is up from 1,250 jobs and a $90 million investment. The company also pledged not to open a retail store in the state.

The Seattle-based company does not currently collect the taxes from South Carolina shoppers. Under the deal, it would begin doing so in January 2016.

"This will never really cost us more than what we're getting today, which is nothing," said House Majority Leader Kenny Bingham, who represents Lexington County. "When we lose sight of what 2,000 jobs mean, we're really getting blind."

The bill requires another perfunctory vote before heading to the Senate.

Amazon Vice President Paul Misener said he looks forward to passage in that chamber.

"We thank the House for voting to bring jobs and investment to South Carolina, and we're grateful to the numerous small businesses, community leaders and public officials in the Midlands for the groundswell of public support," Misener said.

Nearly 50 legislators who voted no last month changed their vote to yes, while two changed their vote to no.

Bingham said Misener called him Tuesday night to offer the enhanced deal, to show Amazon's commitment amid concerns that the company would pack up and leave when the exemption ended.

Rep. Chip Limehouse, R-Mount Pleasant, said he ultimately could not turn his back on 2,000 jobs for central South Carolina, especially considering the incentives packages legislators have passed to bring jobs to the coast.

"In five years, if Amazon stays on, this will be the smartest vote those of us switched took," he said.

Rep. Wendell Gilliard, D-Charleston, said he "flipped for jobs." "Let's just put people to work," he said.

Rep. Peter McCoy, R-Charleston, echoed the sentiments: "The House has overwhelmingly advanced a bill to create thousands of jobs by Amazon and bring millions of dollars to the General Fund -- all without adding a tax to South Carolina Amazon purchasers."

Hours after the last vote, Amazon announced that it was taking job postings off its website and abandoning the site in Lexington County. The 1 million-square-foot facility off Interstate 77 is now about 20 percent complete.

Gov. Nikki Haley and tea party activists who oppose the deal say it's not fair to existing retailers. Haley said Wednesday the sweetened deal changed nothing.

"The governor's position has remained the same throughout this process, and nothing that happened today, or that will happen tomorrow, will change any of that," said her spokesman, Rob Godfrey.

She has said that while she opposes the deal, she will not veto it. If the Senate approves it too, she will let it become law without her signature.