Several states allow investment tax credits whereby a

Info icon This preview shows pages 50–51. Sign up to view the full content.

View Full Document Right Arrow Icon
distort competition and trade between states. Several states allow investment tax credits, whereby a percentage of new investment can be deducted from corporate income tax. States may apply these credits state-wide, or limit them to specific geographic locations (enterprise zones or industrial recovery sites). 203 Some tax incentives are specifically targeted towards particular industrial ventures. (c) Trade adjustment assistance 1. In August 2002, under the Trade Act of 2002, the Trade Adjustment Assistance Program (TAA) was reauthorized until 30 September 2007, and expanded. 204 The TAA consists of three sub- programmes in favour of workers, firms, and farmers. 205 Of the US$1.3 billion available over the whole period for trade adjustment assistance (increased from US$400 million by the Trade Act of 2002), US$259 million will be used to provide training and associated job search and relocation allowances to TAA eligible workers dislocated as a result of foreign trade. The remaining funds will be used to provide income support to individuals certified under the TAA programme. 2. The TAA programme provides retraining, allowances, job search, relocation, a health insurance tax credit, for workers affected by foreign trade. Petitions for assistance can be presented by groups of workers, unions, or state employment agencies. Eligibility is conditional on a determination by the U.S. Department of Labor that an increase in imports of a product contributed importantly to the workers' separation or threat of separation, and to a decline in sales or production of such firms, or that there has been a shift in production to another country that contributed to worker dislocation. The new legislation also raised the statutory cap on funds that may be allocated to the states for training under the TAA for workers, from U$110 million to US$220 million per year. In FY 2002, 1,614 eligibility certifications were issued covering an estimated 232,898 workers; 993 petitions covering an estimated 96,197 workers were denied. 3. The Department of Commerce's Economic Development Administration (EDA) administers the TAA programme for firms and industries. Under this programme, EDA funds a network of 12 Trade Adjustment Assistance Centers (TAACs). TAACs assist firms in completing petitions for certification of eligibility. To be certified as eligible to apply for TAA, a firm must show that increased imports of competing articles contributed importantly to declines in its sales or production, and to the separation or threat thereof of a significant portion of the firm's workers. Once EDA has certified a firm, the TAAC assists the firm in assessing its competitive situation and in developing an adjustment proposal. The firm must typically pay 50% of the cost of each consultant contract, and the maximum amount of technical assistance available to a firm under the TAA programme is US$75,000.
Image of page 50

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 51
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern