INDIANAPOLIS (May 11, 2005) – The heart of Governor Mitch Daniels’ economic growth package became law today when the governor signed a bill that provides new incentives to foster job creation and attract new investment and businesses to Indiana.

 

Senate Enrolled Act 1 provides several new actions to make Indiana more appealing to small and large businesses alike, including modernizing Indiana’s tax code so it is as friendly to the knowledge economy as the traditional economy.

 

“This is a green flag for businesses to invest and grow in Indiana. Some of these incentives are targeted to small businesses, which create the most job growth,” said Daniels, who signed the bill at Indiana University’s Emerging Technology Center. “Companies will be able to invest and grow in our state and help Indiana continue on its comeback, which helps us achieve our goal of growing the income of Hoosiers.”

 

SEA 1:

 

• Increases the research and development tax credit from 10 percent to 15 percent on the first $1 million of qualified expenses, putting Indiana among the nation’s leaders in research and development credits.

 

• Encourages companies to relocate their headquarters to Indiana by providing a tax credit equal to 50 percent of the moving costs.

 

• Establishes a property tax deduction to spur new investment that will retain and create jobs and promote a broader, more stable tax base. This deduction levels the playing field by providing an incentive to all businesses, not just those with the resources to obtain local tax abatements.

 

• Promotes investment in research and development equipment through a 3 percent sales tax exemption for two years and a full 6 percent exemption thereafter. This levels the playing field with such states as Illinois, Michigan and Ohio, which currently offer this exemption.

 

• Provides $2.5 million in additional funding under the venture capital tax credit program to attract capital for high-growth Hoosier businesses.

 

• Simplifies existing tax abatement laws to allow Hoosier businesses to focus on creating jobs and managing their business and not on completing complex forms.

 

The bill also includes provisions to encourage growth in the state’s motor sports industry through updated and expanded sales tax exemptions. It will also allow investors to claim a 20 percent venture capital credit to encourage early-stage investment in Hoosier motor sports businesses. Daniels said the investment in motor sports is an area that has a terrific upside.

 

“It builds on a strength we have and motor sports is a bigger industry than most people think,” said Daniels. “I learned a lot about it while traveling and meeting with people, not just in Indianapolis and gasoline alley, but all over the state. I’m convinced we have an opportunity to do more.”

 

The legislation was authored by Sen. David Ford, R-Hartford City and sponsored in the House by Representatives Eric Turner, R-Marion and Randy Borror, R-Fort Wayne. Other co-authors and co-sponsors included Sen. Luke Kenley, R-Noblesville; Sen. Lindel Hume, D-Princeton; Sen. Vi Simpson, D-Bloomington, and Speaker of the House Brian Bosma, R-Indianapolis.

 

 

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