Columbia City Representative Introduces Medical Device Credit Bill
Posted
Jordan Fouts-
INDIANAPOLIS – A Columbia City state representative has introduced a bill to give up to $7.3 million in tax credit to businesses affected by the medical device excise tax. Introduced in January and passed in February by the House Commerce, Small Business and Economic Development Committee, HB 1412 would allow the Indiana Economic Development Corporation to give tax credits to medical device makers. The bill was authored by Kathy Heuer, a Republican representing House District 83. It was sent on Feb. 14 to the Committee on Ways and Means with Rep. Christina Hale (D-Dist. 87) added as coauthor. The medical device tax, a 2.3 percent tax on the sale of certain medical devices by the manufacturer or importer, went into effect at the beginning of the year as part of the Affordable Care Act. The bill would allow IEDC to award Economic Development for a Growing Economy credit – called EDGE+ bonus credit in the bill – to businesses affected by the excise tax and that create or retain jobs in Indiana. The credit would be in addition to normal EDGE credit for job creation and retention. There are about 280 Indiana manufacturers that may be subject to the device tax, according to the fiscal impact statement for the bill. Together employing about 26,500 workers, those manufacturers are estimated to pay $77.5 million in excise tax this year. The EDGE+ credit for creating jobs would equal $5,000 per job created and $2,500 per job retained in the taxable year. Between 5 and 10 percent of qualifying businesses are expected to apply for and receive the tax credit, representing an annual reduction in deposits of $3.6 to $7.3 million to the state general fund. EDGE+ credit may be offered for jobs created or retained by qualifying taxpayers between May 15, 2013, and May 5, 2018, under the bill. Qualifying companies must employ at least 35 people. The total amount of credits for job retention is $10 million annually, while there is no limit for job creation, according to the statement. EDGE credit was claimed by 1,078 taxpayers in 2010 for a total of $35.8 million.
