Johnson Pushes Tax Credits in Torrington

Johnson Pushes Tax Credits in Torrington

CHARLES W. KIM, Register Citizen Staff

TORRINGTON - Extending federal tax credits will help the city, U.S. Rep. Nancy Johnson, R-5, said Friday.

"We are here today to talk about tax relief," Johnson said during a press conference at City Hall on Main Street. "And how it affects the human fabric of Torrington."

Johnson, Mayor Ryan Bingham, local seniors and businessman Jamie Gregg asked for public support to help Congress pass legislation that would extend certain tax credits, included in the Jobs Growth Tax Reconciliation Act of 2003, for another couple of years.

"If Congress does not pass the legislation in March, the people will suffer," Johnson said.

The act was passed following the economic downturn after the terrorist attacks on Sept. 11, 2001, and are now coming up to be extended, Johnson said.

The three main components include a $100,000 direct write-off of buying new equipment for businesses, a tax credit for dividends earned through investments and the federal matching program that matches dollar-for-dollar in retirement savings by individuals earning less than $30,000 per year.

Johnson said those credits apply to 100,000 people in the 5th District, and 5,500 in the city alone.

"One in four Torrington taxpayers will see their taxes go up if the Congress does not act," Bingham said. "This bill will help small businesses and manufacturers grow."

Section 179 of the law allows for a write-off of up to $100 for new equipment and has shown an average growth in business equipment and software investments of 10.5 percent since the act became law in the third quarter of 2003.

The credit helped Colonial Bronze on Winsted Road compete with China and India, keeping ahead of the curve in the decorative brass hardware business, CEO Gregg said.

"We added four jobs last year," Gregg said. "We are going to continue to grow."

The business, started in 1927 by two Swiss immigrants in the Bronx, moved to Torrington's "Brass Valley" in 1930 because it was the heart of all brass production in the nation at the time, according to the company.

It is now one the last decorative hardware manufacturing businesses in the country, Gregg said.

"Our ability to invest in newer equipment keeps us from succumbing to low-cost foreign labor," Gregg said. "Investment in American business is the best investment for our future."

Johnson said she included a proposal to extend the research and development tax credit to assist firms investing in cutting edge technologies for new product development.

Seventy-five percent of the credit goes directly to paying wages for research and development workers, and will benefit 25 percent of American firms with assets of less than $1 million, Johnson said.

The extensions for the dividend credit and saver credit will help those who are retired and rely on dividends plus Social Security to fund their retirement. It also encourages workers to start putting money away for their retirement, Johnson said.

As an example, a retired married couple living on $50,000 per year, including $15,000 in dividend income on their investments, would see their present federal tax bill increase by $2,250 per year if Congress does not move to extend the credits, Johnson said.

The saver credit is being used by five million low-income Americans with incomes between $10,000 and $30,000.

Congress needs to pass the legislation by March or the tax credits will be lost, Johnson said.

http://www.johnsonforcongress.com/feb-06-torrington.htm