WASHINGTON, DC-U.S. Senator Bob Casey (D-PA) today outlined legislation he intends to introduce to implement a job creation tax credit. Senator Casey is working to add a job creation tax credit to a jobs bill that the Senate is expected to consider.
“Over the last couple years the U.S. economy has steadily shed jobs and wages have largely been stagnant,” said Senator Casey. “We have made progress responding to the economic crisis, but more needs to be done to get people back to work. Times are still tough across the board and margins are slim. That is why I am proposing a job creation tax credit to help employers hire workers, put money back into local economies and spur economic growth.”
Senator Casey’s proposal builds upon the jobs tax credit enacted in 1977 and was responsible for the creation of 700,000 jobs. Employers who increase their payroll by hiring new employees will be eligible to receive a tax credit.
Employers would only receive the credit if they increase payroll. This would address potential fraud where employees are let go and then rehired in order to obtain the tax credit.
Small businesses are the backbone of the American economy and are the real jobs engines of our economy. In recognition of this and to have the maximum impact on job creation, small businesses would receive a larger credit than large employers. The proposal would provide a tax credit of 20% for small employers and 15% for large employers – those with more than 100 full-time employees.
The credit would only apply to an employee’s wages up to median family income of $50,300.
The employer would be eligible to receive the tax credit for one year.
Senator Casey intends to introduce this legislation when the Senate returns to session next week.