Tax credit will be catalyst for economic growth, protect taxpayers
Senator Vogel announced today legislation he introduced called the Pennsylvania Resource Manufacturing (PRM) Tax Credit was passed into law after being amended into House Bill 761. The tax credit will be equal to $.05 for each gallon of ethane purchased by any company that builds an ethane cracker in Pennsylvania.
“I would like to thank the Governor and my colleagues in the House and the Senate for all of their help in passing this important legislation. This was a bipartisan effort that will put thousands of Pennsylvanians back to work. The tax credit will be performance based and will be used for purchasing ethane and for using ethylene for manufactured goods. This will balance the need to attract investment with a strong protection for taxpayers,” Vogel said.
The legislation is designed to attract natural gas ethane feedstock to stay in Pennsylvania, while encouraging manufacturers who use that feedstock to make everyday products to locate their operations in Pennsylvania. Tax credits differ from direct payments by allowing companies to reduce or eliminate their tax burden rather than using direct money from the taxpayers.
Rather than offering a set amount of available tax credits for a long period of time, Senator Vogel’s legislation would require an annual review by the General Assembly. The tax credit also requires that a qualifying refinery owner must invest at least $1 billion into a project and show the creation of at least 2,500 construction jobs.
“With this tax credit, we are one step closer to having a new, robust petro-chemical industry in Pennsylvania. Since I was elected, my number one priority has been doing what I can to help provide good jobs for the people of Pennsylvania. That means new businesses opening up shop across the Commonwealth instead of our neighboring states or the Gulf Coast.” Vogel said.
“We are talking about thousands and thousands of family-sustaining jobs and new revenues we would never have realized without the tax credit. This can truly transform the economy in Pennsylvania,” Vogel added.
Pennsylvania has utilized tax credits to attract other industry clusters – including the Research and Development Tax Credit, which has helped create an industry cluster of pharmaceutical companies in Southeast Pennsylvania. Other examples include tax credits for alternative energy development, the film tax credit, and job creation tax credits.