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Bills Would Aid Manufacturers
State Rep. Bill Huizenga, R-Zeeland, and Rep. Jerry Kooiman, R-Grand Rapids, sponsored key amendments establishing tax credits for distressed businesses that have resorted to major layoffs during tough economic times.
Under House Bills 5255 and 5242, a distressed business, one that has seen at least a 30 percent decline in its fulltime work force over a 24-month period, can apply for a tax credit through the Michigan Economic Growth Authority (MEGA).
“Furniture companies, automotive suppliers and other manufacturers that have been hard-hit by the economic downturn will receive the relief they badly need,” Huizenga said. “This will encourage them to retain current workers, hire back laid-off workers, and will make it easier to expand production in Michigan.”
Qualifying businesses would receive a 25 percent credit on their unemployment insurance liability for current employees, and 50 percent of the liability incurred for re-hiring laid-off employees.
The credits are good for 10 years and have a minimal fiscal impact, according to the House Fiscal Agency. The bills are supported in concept by the Michigan Economic Development Corp. and the Grand Rapids Area Chamber of Commerce.
Only businesses with at least 150 employees can apply for the credit, and the work force reduction must have occurred within the four years prior to application for the tax credit.
“Michigan accounts for 23 percent of the manufacturing jobs lost in the U.S. since 2001. Rep. Huizenga and I are happy to provide tax relief to West Michigan manufacturers,” Kooiman said. “These companies have been harmed by a variety of forces beyond their control, and it’s essential for our workers and families to remove barriers to job creation.”House Bills 5255 and 5242 next move to the full House for consideration.