Amazon Subsidy: Support for e-retailer leaves tax advocates bitter

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Now to the US state of Virginia, where e-commerce giant Amazon is planning to build its new headquarters. Amazon is optimistic it can add jobs in the region but some worry the company's government subsidy may not prove to be the best use of tax revenues. CGTN's Owen Fairclough has more.

Virginia is known as the state for lovers - and it's seduced Amazon.

RALPH NORTHAM VIRGINIA GOVERNOR "Amazon will invest approximately 2.5 billion dollars to establish a major new headquarters here and plans to create at least 25,000 new jobs."

But enticing the company with public money has attracted plenty of criticism from tax advocates. Schools in the county hosting the Northern Virginia site are facing a budget shortfall of up to 43 million dollars next year.

OWEN FAIRCLOUGH NORTHERN VIRGINIA "Virginia is subsidising Amazon to the tune of 573 million dollars. That's 22 thousand dollars for every job if Amazon hits the target. And that's just here in Northern Virginia. In total, Amazon will benefit from more than 2 billion dollars in breaks and incentives for three sites that include New York and Nashville in Tennessee."

Louisiana has a chequered history with incentives like this. It's attracted dozens of Hollywood productions like Jurassic World to the state with lucrative tax breaks but was forced to cap them.

JAN MOLLER DIRECTOR, LOUISIANA BUDGET PROJECT "At one point we were spending more than 250 million dollars a year on this program. So for every dollar that the state spends on a movie production is a dollar that is not being spent to educate a child or to fix a pothole in the street or to invest in a university education or healthcare or any of the things the state buys with its tax dollars."

Amazon insists its Northern Virginia site alone will bring in 3.2 billion dollars in tax revenue over the next 20 years and that Virginia stands to earn a massive return on its investment.

JAY CARNEY SENIOR VICE PRESIDENT, CORPORATE AFFAIRS, AMAZON "These are performance-based incentives that are available to all companies that are offering these kinds of investments and we don't get these kinds of incentives if we don't create the jobs."

Amazon will have up to 12 years to do that as it looks to create 50,500 jobs across its three new sites. OFA, CGTN, Washington.