Peavey Peeved in Mississippi?
March 21, 2008
Musical instrument and sound equipment giant Peavey may rock everywhere from the Sydney Opera House to theme parks and stadiums worldwide, but in Mississippi the company may as well be a chump for continuing its business loyalty to the state. The company was founded in Mississippi and continues to locate 18 of its 33 manufacturing facilities in the state. Peavey has been an upstanding company in the state and was even honored in 1991 by President George H. W. Bush, for workplace training, education and achievements in the international marketplace, according to the company’s website.
So when Hartley Peavey, the company’s founder and CEO, saw company after company – both in-state and newly arriving – getting tax handouts, he decided he would finally ask the legislature for one too. While we don’t favor tax breaks for selected industries, we really can’t blame Mr. Peavey for asking, since the state’s website has a 98-page document listing the handouts available for businesses and special interests. Everything from a motion picture production exemption to an export port charge credit is outlined, with detailed instructions on how to claim these “incentives”. Companies that transfer their headquarters to the state, for example, are rewarded with red carpet tax treatment, while homegrown businesses like Mr. Peavey’s (whose request was denied) must pay higher taxes to make up the difference.
All of these dubious incentives mean that the state’s tax system on its own is not friendly to businesses and job-creators. If Mississippi wants to bring in new business investment and jobs, it should implement broad based tax reform for the long term, which would improve the state’s competitiveness. When businesses are treated the same, loyal homegrown companies aren’t put in the position of subsidizing the red carpet for newcomers.
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