Nicole Sandelier, director of Economic Policy Research at NJBIA and executive director of Focus NJ, provides the following summary of the NJBIA/State Chamber of Commerce’s Taxation and Economic Development Policy Committee meeting, held virtually on Jan. 29.
Last week, the Joint Taxation and Economic Development Policy Committee met virtually with guest speakers John Ficara, the director of the Division of Taxation at the New Jersey Department of Treasury and Tim Sullivan, CEO of the New Jersey Economic Development Authority (NJEDA).
Ficara discussed recent tax changes, including the implementation of the pass-through business alternative income tax (BAIT). Sullivan discussed recent tax changes, as well as the incentive programs included in the Economic Recovery Act of 2020, enacted last month by Gov. Phil Murphy.
Ficara discussed recent tax changes, including recent corporate business tax changes, looming combined reporting regulations and the implementation of the pass-through business alternative income tax (BAIT). Sullivan discussed the new incentive programs included in the Economic Recovery Act of 2020, enacted last month by Gov. Phil Murphy.
The act includes additional tax incentives and programs to encourage economic growth and development. Underlying principles of the new programs include providing relief for businesses, supporting job creation, and investing in innovation.
Key programs in the bill include: the Emerge program (successor to Grow NJ), Aspire program (successor to ERGG), NJ Innovation Evergreen Act, and the Main-Street Recovery Finance Program.
- The Emerge program targets the governor’s priority sectors and communities with the greatest levels of distress for economic growth. The program focuses on new jobs with job creation targets for most projects.
- The Aspire program focuses on development, with awards capped at $50 million allocated for projects in targeted areas, and up to $32 million for all other projects.
- The Innovation Evergreen Act aims to increase innovation through a $500 million fund for New Jersey businesses. Through the program, $60 million worth of tax credits will be auctioned to raise money for venture capitalists, and private money may have matching investments. Qualified venture firms will be able to draw up to $5 million on two investments per year in New Jersey based companies, and there will be an increased cap for businesses which are certified woman- or minority-owned. Additionally, the program will be self-sustaining. Upon exit from the program, proceeds will be distributed back into the fund.
- The Main Street Recovery Finance Program includes a one-time $50 million appropriation for grants and loans to small businesses with ten or less employees. In addition, the program establishes the Main Street Recovery Fund which will distribute grants and loans based on annual appropriations.
For an in-depth analysis of the NJ Economic Recovery Act of 2020, written by NJBIA’s Christopher Emigholz, click here.