In manufacturing and investment tax credit, further providing for definitions, for business firms and for tax credit certificates.
Summary
HB1667 amends Pennsylvania’s Tax Reform Code provisions governing the manufacturing and investment tax credit, specifically the program tied to rural growth funds and related tax credit certificates. The bill changes the definition of “closing date” for program two tax credit authority to make it the earliest of three dates: when a rural growth fund has collected the required amounts, when investment authority is reallocated under existing law, or December 31, 2024. It also increases the program’s overall cap on credit-eligible capital contributions from $30 million to $60 million.
In addition, the bill doubles the annual limit on tax credits that may be utilized in a fiscal year from $6 million to $12 million, while also raising the aggregate cap on tax credit certificates from $30 million to $60 million. The measure takes effect 60 days after enactment and would expand the amount of tax credit authority available under this part of the Tax Reform Code.
Impact
HB1667 would directly amend sections 1822-G, 1828-G, and 1829-G of the Tax Reform Code of 1971, increasing the size of Pennsylvania’s manufacturing and investment tax credit program and extending the amount of credits that can be approved and used. The practical effect is to allow more capital contributions to qualify, permit more tax credit certificates to be issued, and increase the annual and total fiscal exposure associated with the program. The bill primarily affects the Department of Revenue, participating business firms, rural growth funds, and taxpayers claiming or purchasing these credits.
Sentiment
The bill appears to have broad support in the House based on its vote history. It advanced out of the House Finance Committee by a 24-2 vote, was re-reported unanimously by House Rules and House Appropriations, and passed the House floor by a 182-21 vote. The vote pattern suggests general agreement with expanding the credit program, though not complete unanimity.
Contention
The main point of contention is the size of the expansion in tax credit authority and the associated cost to the state. Supporters appear to favor increasing the cap and annual utilization limit to provide more room for investment and participation in the program, while opponents likely object to the larger fiscal commitment and the broader use of tax credits as a policy tool. No committee transcript is available, so the record does not show specific arguments beyond the voting split.
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