February 28, 2007

Governor Offered Millions for Toyota But Can't Cut Your Food Tax

Gov. Phil Bredesen says the state of Tennessee can not afford a $39 million reduction in the state's sales tax on food. But today's newspaper says the Bredesen administration "offered at least $200 million - and perhaps tens of millions more" to try to lure Toyota Motor Corp. to build a $1.3 billion assembly plant in Chattanooga. Toyota reported a quarterly profit of $3.6 billion in the fourth quarter of 2006 - meaning the company earned $1.2 billion per month in October, November and December, almost enough cold hard cash per month to pay cash for its new assembly plant.

The state can't afford to give you a half-cent sales tax reduction on your groceries because the Bredesen administration wants to give hundreds of millions of dollars to wealthy corporations like Toyota that don't really need it. The good news is, now that Toyota has decided to go to Mississippi instead, the Bredesen administration ought to be able to find $39 million to cut the sales tax half a cent.