In tough times, businesses have to cut everything but their core operations. Gov. Jim Doyle demonstrates in his new budget that business development remains a core priority.
Here at the Department of Commerce, we’ll be implementing the most powerful new economic development tools in the nation to help grow jobs and investment and encourage business consolidation in Wisconsin.
This budget provides refundable income and franchise tax credits – essentially like cash – worth up to 7 percent of new, full-time payroll. In some cases, original equipment manufacturers can claim a similar 7 percent of payroll credit if they are making investments to keep jobs here in Wisconsin.
These payroll tax credits can combine with an additional 10-percent refundable credit for companies making significant capital investments.
Also new is a $10 million annual payroll tax credit for small to medium-sized businesses that create family-supporting jobs. In addition, these businesses can access credits to pay for worker training.
At the same time these steps strengthen Wisconsin’s manufacturers and other industries, we are taking steps to spur innovation and investment. We can reward investment in Wisconsin start-up companies while improving access to capital for those companies. For example, investors in qualified start-up companies will see a 100-percent capital gains tax exemption.
This budget bolsters biotechnology by extending the tax exemptions already on manufacturing equipment to research equipment. It helps modernize our meat and dairy industries by making co-ops eligible for a 10 percent tax credit.
This budget also builds on the governor’s successful angel and venture capital investment programs. More companies and more industries will be able to benefit from this investment network, and it will be private companies – not the government – deciding where and how these investments flow.
Janesville and Kenosha have seen economic dislocations from the collapse of the auto industry. This budget provides up to $20 million in tax credits to businesses that create and sustain jobs in Janesville and Kenosha.
It’s worth noting that Wisconsin Manufacturers and Commerce endorsed many of the governor’s economic development proposals in its publication, Moving Wisconsin Forward. In fact, between the budget repair bill and this budget, the governor has checked 11 of 12 goals for innovation and job creation off their list.
Wisconsin businesses have always shown the will, determination and skill to work their way through economic downturns and emerge stronger and more competitive. With this budget, using these new incentives, we will move Wisconsin forward.
Richard Leinenkugel is the secretary of the Wisconsin Department of Commerce.