* Crain’s is reporting that Gov. Quinn will propose a $2,500 per job hiring tax credit for small businesses tomorrow…
The governor hopes the measure will generate as many as 20,000 jobs.
According to a source in Mr. Quinn’s office, the program will be open to companies with 50 or fewer total employees as of June 30.
For each new, full-time Illinois job created and maintained for at least one year, employers would get a $2,500 credit.
This is pretty close to a campaign proposal by Sen. Bill Brady…
I will help create and retain jobs in Illinois through employer incentives. I am proposing a $2,100 tax credit to businesses for every new job they create. The average job brings in $4,200 in revenue to the state. I believe it’s a good investment for the state, attracting new jobs to get Illinois’ unemployed back to work.
The difference, apparently, is that Quinn’s program only applies to small businesses, not big ones. That tack has obvious political advantages.
Thoughts?
- Gregor - Tuesday, Mar 9, 10 @ 12:37 pm:
” And then my name in Petroplavosk is cursed, when he finds out… I published first!- Tom Lehrer
Smart move, and it only applies to the new jobs, so it doesn’t cost anything otherwise. Not too many things you’d want to copy from Brady but this one looks good.
- wordslinger - Tuesday, Mar 9, 10 @ 12:46 pm:
Does anyone make a new hire solely for a $2,500 tax credit? I kind of doubt it, but it’s a nice plum for those who were going to do it anyway.
- TaxMeMore - Tuesday, Mar 9, 10 @ 12:46 pm:
Proposing a 10% salary cut for legislators and state officers would be good too. If Brady was serious he would’ve introduced a bill to cut his pay by 10% already.
- cassandra - Tuesday, Mar 9, 10 @ 12:46 pm:
Tax credits for hiring are becoming the latest fad.
Is it well established that these types of credits
provide incentives for hiring over and above the hiring business would have done anyway. And do the increased revenues and tax credits cancel each other out. Or do the tax credits add to the red ink…or somebody’s else tax bill. There’s no free lunch…really. Pols can’t change that.
- Will County Woman - Tuesday, Mar 9, 10 @ 12:47 pm:
thoughts? you ask????
Quinn should not be governor. If he’s taking ideas from hynes that he once ridiculed then he is taking ideas from brady that he was planning to ridicule. what is interesting so far in the 2010 election cycle (including the primary) is that no one is taking, or has taken, any of quinn’s ideas and trying to pass them off as his own. gee, now i wonder why?
quinn’s inability to come up with any good ideas of his own that he can stick to is because he is old. right now, more than ever illinois needs someone who is fresh, creative and innovative if it is to get out of the trouble it is in. people need to stop feeling sorry for him and supporting him because of that, and start feeling sorry for themselves and face the fact that the outlook in illinois is bleak and so too is their quality of living.
other than self-interest, i still don’t know why quinn is running for governor. he does not have a vision for this state, nor does he have anything to really offer the people of illinois, anymore.
- N'ville - Tuesday, Mar 9, 10 @ 12:50 pm:
Next thing you know, Quinn will be pro-life and anti-gay marriage too….oh wait………
- George - Tuesday, Mar 9, 10 @ 12:50 pm:
Don’t worry, it won’t pass anyway.
- dave - Tuesday, Mar 9, 10 @ 12:59 pm:
**what is interesting so far in the 2010 election cycle (including the primary) is that no one is taking, or has taken, any of quinn’s ideas**
You mean like the progressive income tax that Quinn has championed for years, and that Hynes previously opposed?
- 47th Ward - Tuesday, Mar 9, 10 @ 1:00 pm:
WCW, Rich asked for thoughts, not venom. Do you have anything to say about the idea, or do you just want to bash Quinn?
As for my thoughts, my back of the napkin calculation is that a new job created with an adjusted gross income of $50,000 pays $1,500 in new income taxes. If the state is paying $2,500 to the company that creates said job, we’re subsidizing these $50,000 jobs by $1,000 each, so we’ll actually lose some money on this. And while those newly employed Illinoisans will provide some new sales tax revenue, I still think we’re subsidizing companies for doing something they’d probably do anyway.
So how many small businesses are going to create jobs that pay $50K? Is it worth it to spend $1,000 to get them to do so? I don’t see the payoff as big enough to justify this. Quinn’s subsidy is too high in my opinion. But if he proposed a $1,500 per new job tax break, I think he’d be better served.
- George - Tuesday, Mar 9, 10 @ 1:07 pm:
In the end, Rich, I think there is one big difference.
Brady’s tax credit was estimated to cost $1 billion plus.
Quinn’s looks like it will cost $50 million (20,000 jobs x $2,500 from the Crain’s article).
One’s a more rigid program than the other.
- GetOverIt - Tuesday, Mar 9, 10 @ 1:19 pm:
Let’s see: $2,500 tax break for a new hire. New hire gets a job and can now pay for bills, entertainment and travel - all of which are taxed on some level. Thus, small and big businesses, state and local government, and you and I benefit - albeit, not directly. Good idea I suppose.
- Joe from Joliet - Tuesday, Mar 9, 10 @ 1:19 pm:
…my back of the napkin calculation…
You give that napkin back to Quinn. He has a speech to give.
- already out there - Tuesday, Mar 9, 10 @ 1:20 pm:
This small business only idea is already in movement by the Senate Dems. Have a look at SB 3657 which offers $1,500 for new hires by small business owners.
- JonShibleyFan - Tuesday, Mar 9, 10 @ 1:21 pm:
Quinn is getting better at the politics thing.
- ahoy - Tuesday, Mar 9, 10 @ 1:28 pm:
Dumb policy, businesses don’t create jobs because of a tax credit. Fix the unemployment insurance and workman’s comp insurance problem, that will create more long term jobs then a gimmick.
- Fan of Cap Fax - Tuesday, Mar 9, 10 @ 1:35 pm:
Thanks, ahoy, agree totally with your statement. Small business has to have business to even consider hiring more employees. There aren’t a lot of new jobs, new contracts or old contracts with existing money.
- Champaign Dweller - Tuesday, Mar 9, 10 @ 1:39 pm:
Small business also needs to know with some certainty what the future is going to look like–until the healthcare, cap and trade, and other big ticket issues are finally rejected, I don’t think many small business owners are going to do much hiring, tax credit or not.
- irish - Tuesday, Mar 9, 10 @ 1:45 pm:
Realisitcally the jobs are probably going to be closer to the $30,000.00/year, which means that the income taxes paid would be closer to $1,000.00, and the subsidy equaling $1,500.00.
Wouldn’t tax breaks on investments in ongoing and startup business infrastructure and equipment yield the same result? Maybe longer term? If I hire one person and keep them for one year that might help a little, but if I expand and hire more than one person, those jobs might be more permanent because I am going to need them because of my expansion.
- D.P. Gumby - Tuesday, Mar 9, 10 @ 1:54 pm:
If this tax credit combines w/ the Obama/federal tax credit, does it then make sense for small business to hire new employees?
- 47th Ward - Tuesday, Mar 9, 10 @ 1:56 pm:
Good point irish,
Does anyone else find it odd that this idea is “new spending” at a time when we’re $13 billion in the red? As worthy as attempts to create jobs might be, if the tax revenue generated doesn’t match the expense, we’re just digging the hole deeper.
Anyone else note the irony here?
- wordslinger - Tuesday, Mar 9, 10 @ 2:04 pm:
Existing small businesses staff up when they can’t handle their workload or they face losing business because they don’t have enough people. If they can get away with temps, they will.
- Will County Woman - Tuesday, Mar 9, 10 @ 2:12 pm:
tax me more, i agree that brady should be saying that, and start with himself on taking a pay cut and agreeing to reduced pay if elected. if there is one bright spot about plummer it is his proposed refusal to accept the lt. gov. salary until the unemployment rate goes down. brady should’ve also started out the gate pushing gov office term-limit reform policy by highlighting the serious flaws and complication of recall as proposed by quinn.
dave, please. quinn proposed years ago and not surprisingly it went nowhere. upon his learning of our state’s horrible fiscal condition, he had an opportunity to propose it early last year, but didn’t. he gets no points. failure to prescribe the right remedy when it is needed means he failed.
- 47th Ward - Tuesday, Mar 9, 10 @ 2:21 pm:
WCW, if you have nothing to add to this conversation about tax incentives for businesses that create jobs, then take your bile somewhere else please. You pollute every subject with your incessant Quinn-bashing. It really needs to stop.
- So. Ill - Tuesday, Mar 9, 10 @ 2:27 pm:
See HB 5199 and you will see that this is not Gov. Quinn’s idea…good enough for the budget address but for some reason the bill got stuck in a revenue sub committee. Hmmm.
- OneMan - Tuesday, Mar 9, 10 @ 2:36 pm:
==
According to a source in Mr. Quinn’s office, the program will be open to companies with 50 or fewer total employees as of June 30.
==
The deck is too low. At 50 or fewer employees you are talking restaurants and the like. Not a lot of manufacturing has less than 50 employees unless you are talking job shops and they would only hire if they had the work.
I would suggest increasing the size of the company you give the credit to significantly
- VanillaMan - Tuesday, Mar 9, 10 @ 4:02 pm:
You could add half that amount, without incentives, if you just allowed Walmart into Chicago.
But then, everyone hates Walmart except the millions shopping there.
- Levois - Tuesday, Mar 9, 10 @ 4:03 pm:
Would this still be an example of co-opting a campaign plank?
- George - Tuesday, Mar 9, 10 @ 5:02 pm:
VanillaMan - Walmart can come into Chicago if it wants…
- Justme - Tuesday, Mar 9, 10 @ 10:02 pm:
Sorta reminds you of the time in the distant past (just before the primary) when he claimed credit for landing those Ford jobs by using the EDGE credit, which was George Ryan’s baby.