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Meh, you get a deduction for your state income taxes on you federal taxes, and most of the companies in Arizona only pay the $50 minimum in corporate taxes. (Now, if that federal deduction gets taken away by Congress, then I might be more inclined to agree with you)
If state income taxes were that big of a deal, you would have seen Google, Apple, Oracle, Ebay, HP, Qualcomm, etc, etc, move their headquarters up to Washington State. Rich people go where the talent is. They go where they can get access to more capital and other resources. They go where they can grow.
Even the Arizona Chamber of Commerce isn't pushing for income tax cuts. The top of their agenda this year is improving education. 2nd is reducing health care costs for businesses. 3rd is simplifying sales taxes.
They've already publicly stated they aren't looking for anymore income tax cuts because of the big upper class state income tax cuts scheduled to take effect in 2014 and they are trying to find ways to keep more funding from getting cut from education when the Prop 100 sales tax drops off in June.
Couldn't agree more. Income taxes in AZ are far from onerous to begin with. And wealthy people escape most of them anyway because the Federal taxable income is used as the starting basis and the wealthly have the deductions and loopholes to keep that relatively low. Eliminating income tax would simply shift the burden to property taxes and that would kill the real economic driver in the valley - cheap housing.
You are also right that improving education and the workforce is the number one thing business managers mention when talking about how to attract growth to AZ. It seems to fall on deaf ears at the legislature though.
You are also right that improving education and the workforce is the number one thing business managers mention when talking about how to attract growth to AZ. It seems to fall on deaf ears at the legislature though.
I still think there's a slim chance the FTC will block the merger because it would reduce the number of large carriers from 4 to 3.
United has 28% market share, Delta has 26%, American has 18%, Southwest has 12% and US Air has 10%.
After the merger, you would have 3 carriers controlling over 80% of the US market. Southwest would be the only other airline with over 3% market share.
As an airline/air traffic analyst, I feel obligated to comment on this thread.
PHX is not going to be reduced to a spoke. That said, PHX will be smaller for the combined airline than it is currently today. Currently, PHX averages around 300-350 flight a day for US Airways. I expect that number will be in the 200 range once all is said and done. I also dont see PHX losing most destinations on the coasts, but it probably will lose some in the Midwest (IND and DSM leap to mind). What PHX will lose is frequency. DFW is a much larger air market based on O&D travel as well as premium travel and we will probably see some capacity thrown in that direction. At the end of the day, however, PHX will still be a hub just a smaller one. Think SLC size.
To understand why I say this, you have to understand the dynamics of the Phoenix market:
-As nice of a place as Phoenix is, it is what we call trunk market. Loosely translated, it means there is a lot of volume but very little premium traffic (first class, business class, full fare economy). Other trunk markets include Las Vegas, Tampa, Fort Lauderdale (not Miami), and Orlando. Simply put, even with all that volume, there is very little money to make off of air travel in Phoenix if you are an airline that caters more to the F & J traffic vs. the Y (which American definately is).
-Almost 50% of PHX's international travel market (its O&D not including connections) is to Canada. No other major market in the US has such a lobsided travel market and not much of that is business traffic either. PHX generates very little traffic to Asia, the Middle East, or Indian subcontinent. There is enough demand to from PHX to Europe to support one flight on British Airways, but things will have to change in order to get much more than that.
Where Phoenix is really going to hurt is from the lost jobs. There are going to be a lot of corporate jobs moved to Fort Worth. Heck, I was told Doug Parker moved to Fort Worth last week and enrolled his kids in a private school before the merger was even announced.
As for the claims about Southwest I read earlier in the thread, no PHX is not the largest hub. They claim to not have a hub system, but if you look at their largest operation, its Chicago-Midway at 231 daily departure. Next is Las Vegas with 219 and Baltimore with 176. Phoenix is 4th at 173.
And forget about Southwest ever moving their HQ to Phoenix (someone suggested that earlier in the thread-maybe in jest). Even if they left Dallas, it would be to Houston and virtually no place else.
Dallas has fewer daily departures than those listed, Just Me??
For Southwest Airlines, yes.
Total? No. The busiest airports in the US are Atlanta, Chicago-ORD, Los Angeles, DFW, Denver, New York-JFK, San Francisco, Las Vegas, Charlotte, then Phoenix in that order.
For busiest single airline hubs (those are flights operated by the same airline at the same airport), you have (in order): Delta/Atlanta, American/DFW, United/Houston, United/Chicago, and US Airways/Charlotte. There is a big gap between Delta/Atlanta-American/DFW as well as American/DFW-United/Houston.
Any way you cut it, probably not a good thing for PHX.
I'm a US Gold FF too, so I'm concerned about how the loyalty program merger is going to go. I guess we're going to have to be retrofitted into the OneWorld program. Not looking forward to that, but time will tell how it works out.
I'm a Chairmans and I'm not thrilled with the merger. It's going to very much dilute the upgrades. I hope that we'll still get our CP long haul upgrade certs a year--nice to arrive in Europe with a solid 5-6 hours sleep and a decent breakfast.
Couldn't agree more. Income taxes in AZ are far from onerous to begin with. And wealthy people escape most of them anyway because the Federal taxable income is used as the starting basis and the wealthly have the deductions and loopholes to keep that relatively low. Eliminating income tax would simply shift the burden to property taxes and that would kill the real economic driver in the valley - cheap housing.
You are also right that improving education and the workforce is the number one thing business managers mention when talking about how to attract growth to AZ. It seems to fall on deaf ears at the legislature though.
It's a marketing point. When you can boast that Arizona is an income tax free state, it definitely lures people to examine your state and people to move here. And the more money you make, the more you save so while that income tax may appear to be insignificant, it's not to those making millions.
With regard to your other points, you have to be realistic. With regard to education, there is only so much you can do. You can improve primary and secondary schools but you are not going to improve the college and graduate level education. Most cities have multiple universities to draw talent from and we have ASU and U of A and that's not changing.
With regarding to workforce talent, it doesn't exist in a vacuum. Where do you think talent comes from? That's right other companies which we don't have. It's chicken and the egg, it's gotta start somewhere.
So your strategy has to be practical and realistic. We are not going to be able to lure companies through quality schools and talent. You have to make the state as desirable as possible from a tax and business friendly standpoint. Sure, you are not going to recruit Googles and Microsofts but you can recruit a lot of other upstart companies and corporate branches of other companies.
If you do nothing and hope that our schools and workforce improve, you are not going to get anything. And with regard to cheap housing, what type of people do you want to recruit? Educated people with money who create jobs aren't motivated by low property taxes and cheap housing. What type of people do you want to recruit? Do you want to be status quo and recruit a bunch of snowbirds and retail workers who want cheap housing or people with money who create jobs?
Quote:
Originally Posted by stephen431
If state income taxes were that big of a deal, you would have seen Google, Apple, Oracle, Ebay, HP, Qualcomm, etc, etc, move their headquarters up to Washington State. Rich people go where the talent is. They go where they can get access to more capital and other resources. They go where they can grow.
Even the Arizona Chamber of Commerce isn't pushing for income tax cuts. The top of their agenda this year is improving education. 2nd is reducing health care costs for businesses. 3rd is simplifying sales taxes.
They've already publicly stated they aren't looking for anymore income tax cuts because of the big upper class state income tax cuts scheduled to take effect in 2014 and they are trying to find ways to keep more funding from getting cut from education when the Prop 100 sales tax drops off in June.
The Arizona Chamber of Commerce doesn't exactly impress me and I wouldn't quote them as being some type of authority considering the mistakes they've made in the past. Improving education is a great talking point and we should improve education but it's not going to create jobs in the short term. Again, simplifying sales taxes?? Again, what type of people do you want to recruit here, people who make money and create jobs and aren't concerned about sales tax. Instead we should be modeling ourselves after Texas. We not only need to eliminate income tax, we need to lower fees, reduce red tape, provide more legal protection against litigation and make the state as friendly as possibly from a business standpoint if you want this state to recruit companies because they aren't going to move here for our schools and workforce.
Last edited by azriverfan.; 02-15-2013 at 01:55 PM..
I'm a Chairmans and I'm not thrilled with the merger. It's going to very much dilute the upgrades. I hope that we'll still get our CP long haul upgrade certs a year--nice to arrive in Europe with a solid 5-6 hours sleep and a decent breakfast.
If anything, you should be thrilled. The AAdvantage program is MUCH better than Dividend Miles. Youre miles go a lot further with AAdvantage and awards cost less miles. 325,000 miles for a business class ticket to Europe in High Season??? On American, the same ticket costs 100,000 miles. The availability pool is much better on AA too. If you are top tier, you still get the systemwide upgrade certs and flyers with any level of status get the 500-sticker upgrades.
If anything, you should be thrilled. The AAdvantage program is MUCH better than Dividend Miles. Youre miles go a lot further with AAdvantage and awards cost less miles. 325,000 miles for a business class ticket to Europe in High Season??? On American, the same ticket costs 100,000 miles. The availability pool is much better on AA too. If you are top tier, you still get the systemwide upgrade certs and flyers with any level of status get the 500-sticker upgrades.
How about I spent $2400 on two coach tickets and use my Chairman's Preferred vouchers to fly Envoy to Europe? That gives me 100% mileage bonus and a pretty darn cheap seat.
My husband is only Silver, so he's going to lose his upgrades. Because he typically flies very off peak days/hours (noon on Wednesday for example) he has over 95% success rate with a free upgrade--no miles required.
How about I spent $2400 on two coach tickets and use my Chairman's Preferred vouchers to fly Envoy to Europe? That gives me 100% mileage bonus and a pretty darn cheap seat.
My husband is only Silver, so he's going to lose his upgrades. Because he typically flies very off peak days/hours (noon on Wednesday for example) he has over 95% success rate with a free upgrade--no miles required.
Do you get system wide upgrades anywhere in Europe or South American being only Silver? Im was pretty sure only the Chairman get those. On American, the Execuitive Plats get those too.
Remember, that US and AA will also merge the frequent flyer programs, so you wont lose any miles or status.
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