Small businesses could receive a shot in the arm – in the form of tax breaks for hiring new employees – if legislation proposed by U.S. Senator Kirsten Gillibrand goes into effect.
Gillibrand wants to provide businesses a tax cut worth 15 percent of the cost of a new job hire – with small businesses receiving an additional 5 percent – that would be based on a company’s quarterly payroll increase over the previous year.
“A job creation tax cut is just the type of jolt that we need to help improve confidence, to improve a business’ ability to expand and start hiring again and move our economy in the right direction,” said Gillibrand, who was joined by Congressmember Carolyn Maloney and City Comptroller John Liu at LaGuardia Community College’s NY Designs Center on Tuesday, January 19, for the announcement.
Gillibrand said that Congressional Budget Office reports that tax cuts for firms that create new jobs would be the quickest and most effective measure the country can take right now to stimulate new job creation, and she hopes to include her legislation in a job creation bill that the Senate may take up soon.
During the announcement, Gillibrand said her legislation could create “millions of jobs,” and it also contains safeguards to prevent employers from firing and rehiring employees to claim the tax cut. It also would limit the tax cut claimed by any one firm to $350,000.
“Too many Americans are out of work and any initiative that will help create jobs is tremendously important and this one will,” said Maloney.
Meanwhile, City Comptroller John Liu said that the legislation would be especially important for city businesses where 98 percent of the firms have less than 100 employees.
“This tax cut will serve as an effective tool to preserve the vitality of our small businesses, create new jobs and help get our economy down the road to recovery,” Liu said. “This is really one of the long-term solutions to stabilizing our state and municipal budgets as well.”
One of those small businesses is Bohinj Cleaning and Contracting Inc., which is owned by Long Island City resident Tina Stare. Stare said that the company, which does cleaning and construction projects, has seen its construction portion of the business almost disappear entirely over the past few years, and the cleaning side has also experienced some tough times.
However, Stare believes that if this legislation passes, it would allow her to hire an extra employee on the marketing side of the company, which she hopes would help grow her business.
“I could hire someone to do that, and at the end of my year I could get a reward back in a tax credit,” Stare said.
