Michigan governor Rick Snyder signed into law last week corporate tax credits that would enable companies to forgo paying all state income taxes for up to ten years if a company hires a certain number of workers paying "good" wages.
- But Crain's Detroit Business points out many questions remain whether the law will actually create middle-class jobs and whether the tax incentives will be efficiently spent.
- The law requires companies to, on average, pay a wage that is at or above the average wage in the region where the company employs workers. But critics argue this risks giving companies tax credits for hiring they'd do anyway, and also that companies can get the tax breaks by hiring just a few high-paid executives and many low-paid frontline workers.
- Why it matters: States like Michigan are desperate for policies that result in good-paying jobs, but must remain vigilant that programs aren't easily abused.