U.S. Representative Steve Kagen to propose tax credits for small businesses that add workers
Kagen seeks 15% credit in 2010 for small businesses
By Nathan Phelps
January 13, 2009
Gannett Wisconsin Media
DE PERE — Citing a need to keep working through the recession, U.S. Rep. Steve Kagen, D-Appleton, plans to introduce a bill today that would provide tax credits to businesses that increase wages or add employees in 2010 and 2011.
Kagen made the announcement Tuesday during a press conference at the De Pere Chamber of Commerce.
"It immediately lowers the overhead (costs) of a business and allows them the capital to stay alive, and it has been proven in the past to expand the job base," Kagen said.
Under provisions in the nine-page bill, businesses that expand payroll by 3 percent in this year or 5 percent next year would be eligible for quarterly tax credits.
The proposed legislation includes a 15 percent tax credit in 2010 and a 10 percent credit next year. The bill expires after two years.
Kagen is expected to introduce the bill with Rep. Bob Etheridge of North Carolina.
Nicole Salm, co-owner of Salm Plumbing Inc., in Appleton, said her business has fared well in light of economic conditions and she recently hired two employees.
Salm sees the proposed legislation as something that could be a boon for smaller businesses because it allows employers to raise wages or total hours in addition to creating new jobs.
"It’s not just new employees," she said. "We might also be able to certify some of our plumbers to master plumbers, that would also raise their wages."
Kagen said this concept isn’t new, having last been used in 1976 when tax credits gave employment an 11 percent increase.
"This is a proven concept and is wide-raging for all industries," he said.
If passed, the bill is projected to create 4.7 million jobs in the next two years with a net cost of $8.5 billion over two years, which Kagen said will help stabilize the economy by helping businesses and employees now.