Republicans in the state Senate recently advanced a rewrite of House Bill 334 – which bears the nondescript title “JOBS Grants and Tax Relief.” The new version of the bill has been promoted by its proponents as an “economic relief” measure that will aid businesses still struggling after the COVID-19 recession and will help further stimulate the state’s economy.
However, as North Carolina Budget & Tax Center policy analyst Parker Martin documented at length last week in a pointed post on The Progressive Pulse, the bill’s architects are engaged in a healthy measure of false advertising. This is from Martin’s post:
Senate sponsors claim their rewrite of HB 334, the JOBS Grants and Tax Relief bill, will assist businesses most in need with grant funding and proposed tax cuts to corporations will trickle down to the average North Carolinian. Do not buy it. These claims could not be further from the truth.”
Martin then goes on to explore five “damning truths” about the proposal:
- It won’t help businesses that need it the most.
- It would reinforce previous shortcomings in the way economic aid has been distributed.
- It includes a counterproductive sweetheart deal for corporations.
- The corporate tax cuts in the proposal will likely benefit rich, white and older shareholders the most.
- There is a better way to build an inclusive recovery.
Here are some of the damning numbers Martin’s post highlights:
$1 billion – amount of American Rescue Plan Fiscal Recovery Fund that the bill would allocate to a new “JOBS Grant program” to help businesses with disruptions and costs incurred by COVID-19
Roughly 20% – share of all American Rescue Plan monies coming to the state to meet a range of public health and economic challenges this represents
100% – share of JOBS grants funding that will be awarded to businesses that received funding from previous state or federal recovery programs (e.g., PPP Loans)
Thousands – number of U.S. minority-owned businesses and businesses in lower-income Zip codes that were excluded from PPP loans and other initial COVID relief because of program restrictions and failures of the Small Business Administration under President Trump
100% – share of these businesses in North Carolina that would be excluded from the JOBS Grant program
1 – number of North Carolina programs that specifically target businesses owned by women and Black, Indigenous, People of Color, as well as those eligible for ReTOOLNC grants
0 – number of times the ReTOOLNC program is mentioned in the Senate legislation
2.5% – current North Carolina income tax rate on corporate profits
5 – number of times the rate has already been reduced in the last eight years (from 6.9% to 6% to 5% to 4% to 3% to 2.5%)
7th – rank of corporate income tax rates among 11 factors for business site selection in the most recent survey of corporate executives by Area Development magazine
8.8% – share of corporate income tax revenues the state collects that flow from businesses operating exclusively in North Carolina
91.2% – share of revenues flowing from larger multi-state businesses
85% – share of North Carolina’s new job growth that stems from in-state businesses
2.9% – share of total North Carolina tax revenue that the corporate income tax provides
9.1% – share it provided in the mid-20th century
0% – rate to which the Senate proposal would lower the corporate income tax in 2028
55 – number of major U.S. corporations that already paid zero federal income tax in their most recent fiscal year – in part because of the 2017 Trump tax cut plan
56% – estimated share of Trump tax cut windfall that ended up flowing to investors
89.4% – share of U.S. corporate equities and mutual funds owned by white Americans
1.1% – share owned by Black Americans
0.5% – share owned by Latinx Americans