Legislation enhancing tax incentives for businesses creating jobs in rural areas unanimously passed the House of Representatives Thursday after receiving a favorable committee report Tuesday.
HB 540, or the Alabama Incentives Modernization Act, would enhance the existing Alabama Jobs Act by expanding investment credits to rural projects creating at least 10 new jobs. The bill also extends Jobs Act credits and includes provisions specifically targeting the creation of high-tech jobs.
The bill changes the definition of rural counties under the Jobs Act to include those with populations of less than 50,000. Additional counties qualifying for incentives would be Chambers, Cherokee, Chilton, Covington, Dale, Dallas, Escambia, Franklin, Geneva, Lawrence Marion, Pike and Tallapoosa.
The legislation would extend the Jobs Act Investment Credit to 15 years in rural counties. It also would allow banks and insurance companies to purchase credits. Meanwhile, the Growing Alabama Credit would be available for investment in industrial parks and the Alabama Farm Center.
HB 540 would provide incentives to offset income, premium, utility and financial institution excise taxes. It also would expand the Opportunity Zone program and reduce capital gains taxes for investment in those areas. It includes accountability provisions such as oversight through the Department of Commerce and Renewal of Alabama Commission. The bill does not increase the caps on amounts allowed under the Jobs Act or Growing Alabama Credit. Both programs would still expire in 2020.
HB 540 will now go to the Senate Finance and Taxation Education Committee for consideration.