Posted by Michelle Manchir at 3:20 p.m.
SPRINGFIELD – Gov. Pat Quinn today signed a new tax break into law that he said would create 20,000 jobs, but a key Illinois business leader doubted whether the measure would inspire anyone to hire anybody.
Come July 1, businesses with 50 or fewer employees can apply for a $2,500 tax credit for each full-time employee they hire.
“Small businesses are essential to the Illinois economy and it’s crucial that state government find fresh and creative ways of working with entrepreneurs, who will lead the charge toward economic recovery,” Quinn said.
Kim Clarke Maisch, Illinois director of the National Federation of Independent Business, said the tax credit won’t prompt small-business owners to hire new employees, but companies will be happy to use the credit for any jobs they already planned to create.
“This alone is not going to cause business owners to start hiring,” she said. “They need more customers and they need a better business environment before they’ll hire new employees.”
The state is prepared to give out as many as $50 million in tax credits under the law, according to the Quinn administration. For businesses to qualify, the new hires must be employed for a year, but companies can apply for the credit online as soon as they make a new hire. The application won’t be available until closer to July, according to the governor’s office.
Quinn, who wants to raise the state income tax by 33 percent, is seeking to soften his image in the business community before the November election. The governor faces Republican challenger, Sen. Bill Brady, a Bloomington
businessman and entrepreneur.
Brady, who voted for the measure, said in a statement the legislation fails to go far enough. He has promoted a broader pro-business plan.
“We need to offer tax credits for all businesses regardless of their size” rather than only providing incentives for small businesses, Brady said.