Tenessee Governor Bill Haslam’s proposals for various tax incentives were passed by the State legislature on Saturday. Reported by Tom Humphrey at www.knoxnews.com
The underlying bill on tax incentives was characterized by House Majority Leader Gerald McCormick, R-Chattanooga, who sponsored the bill for Haslam, as “retooling our economic development arsenal.” Among its provisions:
* The state’s current $5,000-per-job tax credit, available to businesses creating at least 100 new jobs under prescribed conditions, will be extended to businesses creating as few as 50 jobs at a reduced rate of credits. For example, creating 50 jobs would get 50 percent of the $5,000 credit per job, or $2,500, while creation of 80 jobs would be 80 percent of the maximum credit.
* The tax credits now available for opening a new headquarters facility in Tennessee involving at least $10 million of investment and 100 new jobs paying 150 percent of the state’s average wage will be extended to companies expanding an existing headquarters by the prescribed amounts.
* Companies receiving tax credits and incentive payments will be subject to audits to ensure they actually met the criteria specified in state law. If it is found they have not complied, the companies would be subject to what McCormick called “a clawback,” forcing return of incentive money or tax credits provided by the state.
McCormick said the net result of the incentives legislation is to “make our state more attractive to economic development and make the companies more accountable.”
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