Provides a 50% tax credit for new income tax revenue generated by a new employee; provides credit may be taken up to 10 years; provides that the Department of Economic Development must monitor and certify the additional employment for any business which applies for the credit; provides any company taking the credit must maintain employment in the state for twice the number of years as the term of the tax credit; provides the Department of Economic Development shall annually report to the governor and the Legislature on the number and amounts of credits.
This bill creates a new refundable “job creation tax credit” in the New York tax law for businesses that add qualifying full-time employees in connection with a new project, facility, product, or service. The credit would equal 50% of the New Income Tax Revenue withheld from the wages of those new employees during the taxable year. The bill defines “new employee” to exclude certain related-party transfers, family members, and employees with a significant ownership interest in the business, and it generally requires the jobs to be newly created in New York rather than shifted from a related member.
To qualify, a taxpayer must file an application with the Department of Economic Development describing the project, showing that the project is economically sound, and stating that the credit is a major factor in moving forward. The credit term may not exceed 10 years, and the business must agree to keep operations at the project location for at least twice that long. The department must verify annual employment and withholding figures, issue a certificate, and report annually to state leaders. The bill also requires a first-year evaluation of the program’s job-creation and revenue effects, with a report due by January 1, 2028.
The bill would amend both the corporate franchise tax provisions and the personal income tax provisions of the Tax Law to add parallel job creation credit programs. It would create a new refundable credit available to eligible taxpayers, including partnerships, S corporations, and other pass-through entities, and would authorize the Department of Economic Development and the tax commissioner to adopt implementing regulations, verify claims, and recapture credits if reporting requirements are not met. The bill would apply to taxable years beginning on or after April 1, 2025, and would therefore affect businesses making new hiring and investment decisions in New York after that date.
The available context suggests generally favorable policy intent toward economic development and job creation, with the bill framed as an incentive to encourage businesses to expand in New York. The bill text emphasizes that the credit is meant to foster employment, strengthen the economy, and support projects that would not proceed without the incentive. No committee transcript or vote record is provided, so there is no direct evidence of formal support or opposition in the materials beyond the bill’s pro-growth framing.
The main points of potential contention are the fiscal cost of the refundable credit, the risk that the state would subsidize jobs that might have been created anyway, and the administrative burden of annual verification and reporting. The bill attempts to address abuse concerns by excluding related-party transfers, family members, and significant owners from the definition of new employee, and by requiring businesses to maintain operations for twice the credit term. Another possible point of debate is whether a 50% credit on withholding revenue and a term of up to 10 years provides an effective enough incentive to justify the revenue impact, which the bill itself requires the state to evaluate.