I wanted to find something to say about Hillary Clinton's recent proposal for tax credits to companies who "insource." It seems possible there is some sort of favoritism for domestic companies in there somewhere. The problem is, I can't figure out what the proposal actually entails. The most detailed statement I can find is from her web site:
3. A new Insourcing Markets Tax Credit to spur business investment in communities facing global competition. Building off the success of the New Markets Tax Credit Program, Senator Clinton will launch a new public/private partnership to bring new investment and jobs to communities that are vulnerable to global competition, and provide them with the tools to become leaders in our economy. While the NMTC has played a crucial role in bringing investment and job growth to poor and underserved areas, many communities impacted by globalization have acute needs: requiring large and fast-acting infusions of capital to diversify and modernize in the wake of job losses and unemployment.
In addition to reauthorizing the NMTC, Senator Clinton will create a new $5 billion Insourcing Markets Tax Credit dedicated to communities impacted by global competition, trade and technological change. The Secretary of Treasury – in consultation with the Secretary of Labor and Commerce – will determine eligible trade-impacted communities, using relevant economic data and workforce data. Given the goals of modernization and economic diversification in these areas, Treasury will require the community development groups selected to solicit private IMTC investors to put particular emphasis on projects that bring in new industries and companies into these communities as well as create high-quality long term employment. Eligibility for IMTCs will also be expanded to Small Business Investment Corporations (SBICs) that have expertise in trade-impacted industries, such as manufacturing. SBICs have invested more than $4.3 billion in small manufacturing companies during the past decade, even during a challenging time for the industry.
So, the tax credit goes to "communities impacted by global competition, trade and technological change." But what exactly do they have to do to get it? Finding "projects that bring in new industries and companies into these communities as well as create high-quality long term employment" appears to be the key. This sounds kind of like a location incentive, but it's not completely clear.
