A recent New York Times study finds Indiana does not hand out as many tax incentives as its neighboring states. Officials at the state’s head economic corporation say that’s because its tax breaks are performance-based.
Indiana spends just more than $900 million each year on tax incentives, according to the NY Times report. Indiana’s neighboring states all handed out more than $1.4 billion each in tax breaks with Michigan spending more than $6.6 billion.
But Indiana Economic Development Corporation spokeswoman Katelyn Hancock says even the $900 million is a high estimate because that is based on the total tax breaks the state initially offers, not what it actually pays out.
“Our offer, which again is performance based, is probably going to be paid over a long period of time after jobs are actually created versus paid out the door this year,” Hancock says.
The company that received the largest tax incentive in the past five years was Metal Technologies Inc., which was offered more than $35 million in corporate income tax credits and free governmental services.
The two companies that received the next largest incentives were Bright Automotive and Enerdel. They were offered more than $24 million each. But those two companies declared bankruptcy earlier this year.
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Hancock says she did not know exactly how much the two companies had received before they declared bankruptcy. But she says IEDC lawyers are working to recover some of the tax breaks the companies did claim.
