Skip to main content
Sunday, May 9, 2010 - 6:19pm

Can Georgia Afford the JOBS Act?

Updated: 4 years ago.
Policy analysts say the state can't afford $400 million in tax breaks, but business leaders say the bulk of the credits wouldn't kick in until the economy improves. (photo by Tracy Olson via flickr)

Business groups are urging the governor to sign a bill they say would create jobs, but policy analysts say it’s mostly a bill of tax credits the state can’t afford.

The so-called "JOBS (Jobs, Opportunity and Business Success) Act of 2010" offers a $125 tax credit to companies for each new job they create, gives credits to investors of new small businesses, and cuts the capital gains tax in half.

Capital gains is what people and corporations pay when they sell their investments.

It’s the heftiest chunk of the bill says Sarah Beth Gehl with the Georgia Budget and Policy Institute totaling $350 million.

The governor vetoed a similar bill last year because he said the state couldn’t afford it.

"It puts in place $400 million in tax breaks which will mean more cuts to services, so we’ll see more cuts to things like education, public safety, and front line caseworkers, so it sets us up to have to do the same painful cuts in critical services that we’re experiencing right now."

David Reynor with the National Federation of Independent Businesses says this year’s bill has been revised so the capital gains tax break wouldn’t kick unless the economy improves and the state reserves reach a billion dollars.

"We put that buffer in the legislation to alleviate any concerns to our current budget situation," says Reynor.

Governor Perdue still has about three weeks to decide whether to sign it into law.