Kansas House Bill HB2471

Kansas 2023-2024 Regular Session

• Introduced: 4/26/23
• Refer: 4/26/23
• Failed: 4/30/24

Caption

Establishing the transformation of passenger and freight vehicle industry program to attract businesses engaged in electric motor vehicle and hydrogen-powered vehicle production by offering qualified companies that meet certain requirements an investment tax credit, retention of a percentage of total payroll tax, reimbursement of a percentage of eligible employee training and education expenses and a sales tax exemption for construction costs of the qualified company’s qualified business facility.

Impact

The bill is set to amend existing laws related to economic development by establishing a new framework for industry-focused tax incentives. The creation of the New Employee Training and Education Fund is noteworthy, which will provide financial assistance to companies for the training of new hires. This is intended to not only stimulate job creation but also ensure that the workforce is skilled and prepared for employment in the modern vehicle industry. The expected net impact includes fostering innovation, attracting investment, and expanding the state’s economy through job growth.

Summary

House Bill 2471, known as the Transformation of the Passenger and Freight Vehicle Industry Act, focuses on stimulating economic development within Kansas specifically aimed at the vehicle manufacturing sector. The bill introduces various tax incentives tailored for companies that meet specific employment and capital investment criteria. Companies that create a minimum of 250 new jobs and commit to substantial capital investments can benefit from refundable income, privilege, and premium tax credits alongside sales tax exemptions for construction projects. This aims to attract both existing and new businesses to invest and expand in Kansas, particularly in the electric and hydrogen vehicle sectors.

Contention

There may be potential contention surrounding HB2471 regarding the adequacy of tax incentives and the likelihood of meeting the employment targets outlined within. Critics may argue that such incentives could lead to a reliance on state funds without guaranteeing sustainable job creation. Additionally, the bill’s provision for penalties in cases of non-compliance with job creation targets could raise concerns about the feasibility of such ambitious goals. The discussion around the effectiveness of these incentives, as well as their alignment with broader state economic strategies, is likely to be a significant point of debate among stakeholders.