The U.S. Supreme Court said Tuesday it will decide how states may
use tax incentives to lure companies to build car plants and other
projects, a major test of job-creation strategies nationwide.
Justices will review an Ohio tax program used thousands of times
over the past decade until an appeals court ruled last year that it
was unconstitutional.
The law was challenged by taxpayers who contend that state
bidding wars over car plants and other development have gotten out
of hand, with taxpayers footing the bill. They sued over an
investment tax credit that Ohio gave DaimlerChrysler to build a Jeep
assembly plant that opened in Toledo in 2001.
The car maker and the state of Ohio urged the Supreme Court to
take the case, as did the taxpayers.
All sides agree that the case could have a sweeping national
impact, with virtually every state having some type of incentive
program. States competing for new employers often include tax
credits as part of a package deal.
If the high court, which goes back in session on Oct. 3, puts
limits on industrial tax incentives, South Carolina plans to lure
businesses with other attractions.
“We would focus more on selling our other competitive advantages
— quality of life, worker training, tax environment and tort
environment,” said Joel Sawyer, spokesman for Gov. Mark Sanford.
“Tax incentives are part of the competitive environment states find
themselves in today, but they are only part of the puzzle.”
Meanwhile, the S.C. Chamber of Commerce considers incentives an
important part worthy of preservation.
“Every state is different, and ... needs to be able to design
packages to attract the companies they can best get,” said chamber
president Hunter Howard.
The Associated Press and staff writer James D. McWilliams
contributed to this
report.
