WASHINGTON - Bipartisan bills that would ease requirements for empowerment zone bonds and make a moratorium on taxing Internet access permanent have recently been introduced in the Senate.
Sens. Debbie Stabenow, D-Mich., and Roy Blunt, R-Mo., have introduced legislation that would renew empowerment zone tax incentives and ease requirements for empowerment zone facility bonds. The Empowering Jobs Act of 2015, S. 408, was introduced earlier this month has been referred to the Senate Finance Committee, of which Stabenow is a member.
Congress established empowerment zones in 1994 to help distressed communities. Empowerment zones can take advantage of certain tax incentives, including the ability to issue tax-exempt empowerment zone facility bonds.
Empowerment zone tax incentives are a "tax extender," or a temporary provision that has to be periodically extended. The designations were last extended in December retroactively through 2014. Stabenow's and Blunt's bill would extend empowerment zone designations through the end of 2016.
The bill would also make it easier for allocations of empowerment zone bonds to be used. These bonds finance facilities used by qualifying businesses in empowerment zones. Under federal tax law, in order for a business to qualify, at least 35% of its employees have to be residents of the zone. The bill would allow this in-zone hiring requirement to be met if 35% of a business' employees are residents of distressed U.S. Census tracts within the city where the empowerment zone is located, according to news releases from Stabenow and Blunt.
Detroit Mayor Mike Duggan said in Stabenow's release that the bill would help economic development in his city.
"If enacted, the legislation introduced by Senators Stabenow and Blunt would be a great tool to help jumpstart new investment in Detroit's empowerment zone and create employment opportunities for our residents," Duggan said. "We are seeing a renewed interest in investing in Detroit. These proposed modifications to the empowerment zone program would make it a lot easier for us to bring more economic development plans to reality."
Additionally, Sens. Ron Wyden, D-Ore., and John Thune, R-S.D., have reintroduced legislation that would make the moratorium on taxing Internet access permanent.
The Internet Tax Freedom Forever Act (S. 431) was introduced Tuesday and referred to the Senate Finance Committee. Wyden is the top Democrat on the Senate Finance Committee, and Thune is a member of the panel, as well as chairman of the Senate Commerce Committee.
The Internet Tax Freedom Act, which was co-authored by Wyden and passed in 1998, bans state and local governments from imposing new taxes on Internet access and "multiple and discriminatory" taxes on e-commerce, according to a news release. Congress has extended the ITFA five times, but it is set to expire on Oct. 1 absent additional action. Wyden and Thune's bill would make the ban permanent.
Wyden's and Thune's bill already has support from more than 40 Senators. The two Senators introduced a very similar bill in the last Congress.
Last year, a bill to make the ITFA permanent passed the House. The legislation has already been reintroduced in the House this year by Rep. Bob Goodlatte, R-Va., who is the chairman of the House Judiciary Committee.
