economy getting you down? Don't take Atlanta off your short list just yet. In fact,
you may want to move it to the top. The state of Georgia is proposing business-
friendly legislation geared toward making Georgia the same oasis of business-
friendliness in the USA that Ireland's "Celtic Tiger" is in Europe.
ATLANTA - Governor Sonny Perdue announced that House Ways and Means Committee Chairman Rep. Larry O'Neal has introduced a legislative package that will position Georgia as a more aggressive competitor for economic development projects that grow jobs and investment in the state. The proposed changes to the "Business Expansion Support" Act (BEST) legislation in House Bill 438 and House Bill 439 would enhance and update existing tax credit programs for qualified businesses, including both new and existing companies.
The Quality Jobs Tax Credit re-purposes the existing headquarters tax credit, which would no longer be utilized. Companies would receive a benefit for establishing jobs paying a higher-than-average wage for the proposed county. The tax credit would be based on a scaled system and could apply to a headquarters location or any other project that met the established criteria of high-paying jobs.
The R&D Tax Credit will encourage innovative companies in Georgia by strengthening the existing tax credit. It removes the requirement that emerging companies have a positive net income for the previous three years, a restriction challenging to most new companies in the technology field. Instead, the Georgia tax credit will now be tied to the federal calculation, which states that a qualified company may claim 10 percent of its increased qualified research over gross receipts. Eligible companies must continue to qualify for a research credit under the IRS code. Emerging companies may use the credit against payroll withholding for their first five years of operation.
A new version of the Port Tax Credit will drive increased jobs and investment in the state by encouraging companies to do more business through Georgia's ports. The credit would be expanded to apply to imports as well as exports. It would also change the existing code by calculating port tax credits tied to base port usage figures that are updated yearly instead of wedded to the current fixed, 1997 figure.
Changes to the existing Retraining Tax Credit will return the measure to its original intent: helping Georgia companies stay competitive by assisting employees with retraining for new technologies, equipment and machinery. The language of the code would be clarified to establish a stronger definition of the business and activities eligible for the tax credit.
Part of the changes to the BEST legislation includes a Discretionary Withholding Option, a tool the state could employ in winning a particularly competitive project with significant regional economic development impact. This option gives the state the ability to offer payroll withholding benefits once all other tax liability has been exhausted. Awards would be structured similarly to the existing OneGeorgia REBA and EDGE grants, in which the Georgia Department of Economic Development, with the approval of the Governor, recommends the option, and the Georgia Department of Community Affairs processes the final approval.
Finally, the BEST package includes a Mega Tax Credit intended for large, high-impact economic development projects, such as the Kia automotive manufacturing plant, which, together with its suppliers, is creating thousands of jobs in West Georgia. A qualifying company must agree to create a minimum of 1,800 jobs and either invest a minimum of $450 million in a project or bring an annual payroll of $150 million to the state.
Companies who benefit from any part of the BEST program must fulfill the commitments they made to receive them or forfeit their benefits. None of the measures are retroactive.
This is great stuff.