Rhode Island representative proposes job creation tax credit

WARWICK, R.I. (AP) - Rhode Island needs a new tax credit for employers in hopes of improving the state’s business climate, state officials said Tuesday.

State Rep. Joseph Shekarchi said he’s amending a tax credit proposal he introduced this session. The revamped tax credit would be limited to the amount of state income taxes paid by a new employee, an effort to give businesses incentives to invest in Rhode Island through 2020, the Warwick Democrat said.

It’s no secret that Rhode Island has developed a reputation as a difficult place to do business, Shekarchi added.

“Ideas like this bill, along with others in the budget and in the General Assembly, will help us change this attitude,” said Shekarchi, the chairman of the House Labor Committee.

Shekarchi unveiled the proposal Tuesday at an event in Warwick with Gov. Gina Raimondo, House Speaker Nicholas Mattiello, and other state and local leaders.

The state needs to create jobs, train people and make it less expensive and easier to do business, Raimondo said.

“This particular bill that Rep. Shekarchi is moving will send a loud and clear signal that Rhode Island is serious,” she said. “We are getting in the game with the economic development tools we need, to get this economy back on track.”

The House is focused on jobs and the economy, and Shekarchi’s bill, or a version of it, will be included in this year’s budget, Mattiello said.

“We will incentivize people to invest in jobs to invest in Rhode Island and to grow here,” he said.

Shekarchi has lobbied for a job creation tax credit for three years. It hasn’t faced stiff opposition, but in previous years legislators focused on other priorities. Shekarchi said he worked recently with Raimondo, Mattiello and others to make the bill better.

He said his original proposal would have cost $7 million to $9 million annually.

The bill also increases the credit for businesses in transportation hubs, distressed communities, and specified high-tech industries, Shekarchi said. He expects a hearing in two to three weeks.