You Be the Judge
Are tax incentives to attract businesses unconstitutional?
By C.J. Prince •
Opinions expressed by Entrepreneur contributors are their own.
In late September, the Supreme Court agreed to hear an Ohio caseon state tax incentives, and its decision could affect similarincentive programs nationwide. The suit was brought by threeseparate plaintiffs, each alleging that incentives provided by thestate of Ohio to DaimlerChrysler AG to build a manufacturingfacility in the state were unconstitutional.
The decision, says Walter Hellerstein, professor of law at theUniversity of Georgia School of Law, "has tremendousimplications for the constitutionality of the garden-variety creditagainst income tax liability for new equipment. Many states havethat kind of credit." Those states could find their incentiveprograms running afoul of commerce law.
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