Immediate Action Needed to protect WOTC!
As stated earlier on this blog, the Work Opportunity Tax Credit (WOTC) is a valuable incentive program that effectively works to encourage employers to hire those who need work the most and grows the economy by leading to more employment. Indeed, there is a direct relationship between an individual who is hired under the eligibility criteria of the program, and now that individual not being dependent on public assistance. The savings from removing individuals from public assistance by placing them in jobs on private payrolls far outweigh the cost of the tax incentive.
Senate Finance Committee Chairman Max Baucus (D-Montana) and his ranking Republican Member, Orrin Hatch (R-Utah) distributed a letter to their Members asking for written responses as to what specific tax expenditures that their members would like to keep in the tax code, and what, if any, modifications to those programs should be made. Senators are being asked to indicate what tax expenditures they want included with a response deadline of July 26.
To take action now and tell your Senators that WOTC is a key part of your hiring and business planning, please go to WOTCmeansjobs.com and click on the “action center.”. A preformatted email is provided and can be sent to your Senators directly within the website.
The Senators put forth guidelines saying that for each expenditure that is kept in the tax code there must be “clear evidence that they: (1) help grow the economy, (2) make the tax code fairer, or (3) effectively promote other important policy objectives. Of these criteria, WOTC clearly meets two as it (1) “helps to grow the economy” by
putting people to work and it (2) “effectively promotes other important policy objectives” by reducing public assistance (see “A Detailed Assessment of the Value of WOTC” by Prof. Peter Cappelli).
It is important that all concerned employers tell their senators to let Senators Baucus and Hatch know that WOTC should be included
in their tax reform package. The Chairman and Ranking Member point out that their ability to reduce rates will be dependent on the number of tax expenditures that are retained as well as the amount of revenue that is used from the elimination of expenditures and used for deficit reduction.