Kirsten Gillibrand United States Senator for New York
Cutting Taxes to Create New Jobs
With the U.S. two years into the worst economic downturn since the Great Depression and over 850,000 New Yorkers out of work, U.S. Senator Kirsten Gillibrand authored and introduced legislation to cut taxes for businesses that create new jobs.
The Congressional Budget Office estimates that a tax cut for firms that create new jobs would be the quickest, most effective measure we can take to create new jobs right now -- and would garner just as much economic return as spending on new infrastructure.
The Economic Policy Institute estimates that Senator Gillibrand's legislation could create over one million jobs within just one year.
While the American Recovery and Reinvestment Act has created or saved more than 140,000 jobs in New York, the job market is traditionally the last part of the economy to recover from a recession.
READ Senator Gillibrand's full report on unemployment in New York.
To get more New Yorkers back to work starting right now, Senator Gillibrand's new legislation would provide businesses a tax cut worth 15 percent of the cost of a new job. Small businesses would receive an additional 5 percent -- cutting 20 percent of their increased payroll costs.
The tax cut would be structured based on a firm's quarterly payroll increase over the previous year, meaning businesses would have an added incentive to expand part-time workers to full-time, or eliminate salary cuts implemented during the downturn.
The legislation would also protect against fraud by preventing employers from firing and re-hiring to claim the tax cut -- and prevents abuse by limiting the credit claimed by any one firm to $350,000 and excluding mergers or aquisitions where no new jobs are created.
Senator Gillibrand believes that the job creation tax cut, with appropriate safeguards, is one of the most efficient ways to create a large number of jobs quickly. It would address what is perhaps the most persistent and harmful aspect of the economic downturn: unemployment. Such a measure not only is an efficient way to create a large number of jobs quickly, but also bolster long-term economic recovery investments -- from high-speed rail and health care information technology, to rural broadband and a smart energy grid.
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