Gov. Mike Pence and Indianapolis mayor Greg Ballard joined company officials from Hat World Inc/LIDS Sports Group for a major jobs announcement Friday.
Executives announced the company would be adding 758 new jobs by the year 2025.
“This is a great day for Central Indiana,” said Pence. “The expansion of Hat World & LIDS is a real testament to the fact that Indiana is open for business.”
According to officials, the Indiana Economic Development Corporation offered Hat World up to $3.4 million in conditional tax credits based on the company’s job creation plans.
“The tax incentives are always a part of it,” said company president Ken Kocher. “But what attracted us to the northwest side corridor was a deal that was expandable, that we could work with in the years to come.”
Still, the governor says he thinks even more businesses would come to the Hoosier state if Indiana were to phase out the business personal property tax, a tax on business equipment and machinery. This week, GOP lawmakers introduced dueling plans in the House and Senate, which the governor called a good first step.
“I want to do that in a way that doesn’t harm our local communities and in a way that doesn’t shift the burden to individual taxpayers,” said Pence. “And I think these initial bills represent an important beginning of what I hope is a robust debate.”
“Indiana has that business personal property tax that we all hope gets repealed or lessened,” said Kocher. “It would help us, it would all Hoosiers.”
House lawmakers want to make the phase-out optional on a county-by-county basis, and apply the tax cut only to new investments.
House minority leader Scott Pelath, D-Michigan City, said he thought the plan presented by GOP lawmakers was more suitable than Pence’s proposal.
“(Bosma) has essentially given up on the Governor`s proposal to eliminate the business personal property tax,” said Pelath. “I think that that is a good move. If you look at what the Speaker has proposed here, it’s basically just tax abatement. It’s basically what local communities can already do.”
“Those counties that want this investment and don’t have it today will probably jump on the bandwagon quickly,” said Bosma earlier this week. “Those that are already heavily invested in manufacturing and reliant on this source of revenue may wait and see how the chips fall.”
This isn’t the first time Pence and members of his own party have differed on major tax legislation. Pence and GOP lawmakers battled last session over Pence’s income tax cut proposal, a 10 percent tax cut which eventually became a five percent tax cut after months of negotiation.
GOP lawmakers and the governor agree something needs to be done to cut the tax in an effort to attract more jobs and businesses to the state. Many neighboring states don’t have the tax or are in the process of phasing it out. Still, some worried the governor’s proposal would mean drastically less money for local governments, or perhaps higher taxes for homeowners if an income tax replacement were to fill the void.
“I think it makes sense to not shift more of the tax burden on to homeowners (and) not have more shortfalls for local government, so they have less police protection, less fire protection, less plowing ability,” said Pelath, who was extremely critical of the local snow removal effort this week.