At today's Indiana Economic Development Corporation (IEDC) board meeting, Governor Mike Pence signed into law tax reform that will allow Hoosier businesses to grow and create jobs by making it possible to phase out the business personal property tax. The tax reform bill, SEA 1, also lowers the corporate tax rate, giving Indiana the 2nd lowest corporate tax rate in the nation, up from 25th, and lowers the financial institutions tax; these two changes will save Hoosier job-creators $185 million per year when fully implemented. Governor Pence also signed HEA 1035, launching a study through IEDC to analyze and recommend quality of life improvements to our state's regional cities.
"Job creation is job one in Indiana and the legislation signed today will strengthen our competitive edge to attract new businesses and good-paying jobs to our state," said Governor Pence. "We are in a national and global competition for jobs and these important reforms will improve our pro-business tax environment and bring good jobs for Hoosiers."
SEA 1 provides counties with new tools to attract job creators by reforming the business personal property tax at the local level. Counties will have the option of eliminating the tax on new investment, offering specific companies an extended abatement of the tax, or exempting small businesses with less than $20,000 in business personal property from the tax entirely. SEA 1 also establishes a comprehensive study commission to look at business taxation broadly.
Under HEA 1035, IEDC will conduct a data-driven study on how Indiana's regional cities can attract new investment to make them more attractive places to locate new enterprises and attract talented entrepreneurs. IEDC also will assess the best private sector financing mechanisms to ensure long-term sustainability.
In addition, Governor Pence also signed today the following agenda bills to help bring more jobs to Indiana:
HEA 1198, which eases the requirements for entrepreneurs to start and grow their business by mandating executive agency participation in the Business One Stop online portal.
SEA 375, which allows new fundraising tools for entrepreneurs including online crowdfunding.
SEA 421, which cuts red tape and unnecessary licensing requirements for Indiana employers.
SEA 111, which protects Indiana farmers from unanticipated increases in their property taxes.
Since April 2013, Governor Pence has signed $643 million in annual tax relief into law, and this number could grow depending on how many counties decide to phase out their business personal property tax. Here's a breakdown of the tax relief:
$313 million for hardworking Hoosiers through last year's 5% income tax reduction
$170 million for Hoosier job creators through this year's reduction of Indiana's corporate tax from 6.5% to 4.9%
$125 million through last year's elimination of the death tax
$35 million for Indiana's financial institutions in both last year's and this year's tax reforms
The Governor will sign a number of other bills today. Learn more by visiting Bill Watch: http://www.in.gov/gov/2014billwatch.htm.