ATLANTA — A legislative package of tax breaks and credits designed to thin the state’s burgeoning unemployment rolls easily cleared the state Senate on Wednesday.
But the plan, which gives tax credits to employers who hire from the state’s unemployment rolls, sparked intense debate from opponents over whether it would cost the state too much money and yield too few jobs.
Republicans and Democrats sparred over competing analyses of what House Bill 481, known as the JOBS Act of 2009, would mean for the job market and state finances.
Democrats who opposed the bill, sponsored by Rep. Tom Graves, R-Ranger, pointed to a Georgia Budget and Policy Institute analysis showing the bill’s tax credits would tear a roughly $500 million hole in state revenues, while creating only a few thousand jobs.
Sen. Nan Orrock, D-Atlanta, called the bill irresponsible in light of the state budget deficit and subsequent cutbacks, closure of the domiciliary unit at the veterans home and reductions in care for children with autism.
“This is shooting from the hip. This is fiscal policy willy nilly,” she said.
But Republicans rallied around a fiscal note attached to the bill, which showed it would spark creation of about 27,000 jobs. That number resonated with many senators whose districts are swelling with idled workers, numbering about 446,000 a week ago.
“It’s about one thing and one thing only — creating jobs in Georgia,” said Sen. Chip Rogers, R-Woodstock, the bill’s sponsor in the Senate.
In a statement, Rep. Graves thanked the Senate for its bipartisan support of a measure aimed at economic recovery.
“The quickest route to economic recovery is through the creation, expansion and attraction of sustainable jobs,” he said.
Specifically, the bill gives up to $500 in unemployment tax credits to employers who hire an unemployed worker. It also gives a $2,400 tax credit to companies that keep a formerly unemployed worker on for at least two years.
The bill now goes to conference committee to iron out differences between the House and Senate versions.
Rep. Graves stripped a provision gradually eliminating the 6 percent corporate income tax, but the Senate Finance Committee reinstated that provision, and the bill will phase out that tax by 2023.
A companion measure, HB 482, which will ask voters to eliminate the state’s inventory tax, also passed the Senate.
The tax raises about $2 million a year and likely chases off much more potential revenue from companies that locate elsewhere. Georgia is only one of six states with such a tax, Sen. Rogers said.