why tech companies are in San Francisco when they could have cheap offices and fast internet pretty much anywhere?
In: Technology
Taxes. Large tech companies CAN do what they do anywhere, so they routinely threaten to leave the area unless they get tax incentives to stay. See Amazon in Seattle as an example, or Boeing in New Jersey.
Edit: in most cases the benefit of a reduced tax liability is preferable over a reduced operating cost. While a lower operating cost would result in higher profit, that higher profit is still taxed at a corresponding rate, resulting in more taxes paid. But higher expenses mean more cost deductions for tax calculation, PLUS the negotiated tax incentive, resulting in significantly less profit being lost to taxes compared to a lower cost of operating.
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