Proposed workforce tax credit could apply to training for 800 Hoosiers

Indiana employers who pay for additional staff training that leads to increased wages could be partially reimbursed for the investment through a new tax credit included in the latest state budget bill.

The Hoosier Workforce Investment Tax Credit in House Bill 1001 would allow a business to claim a $5,000 credit per employee and up to $50,000 total for a maximum of 10 employees.

The legislation requires that a business increase the worker’s annual wage by at least 25% to claim the credit.

At least 800 workers per year could receive training and pay raises under a $4 million cap.

“If you’re a company that goes out and buys a piece of equipment that increases the productivity of your particular organization, you get a tax credit for that,” Secretary of Commerce David Adams said during an Indy Chamber event Tuesday. “We’re doing the same thing for human capital. We’re recognizing that human capital is the most valuable resource this state has.

The tax credit is part of a state effort to improve wages through “upskilling,” which is training specifically to advance a worker’s skillset that allows them to work in higher-paying positions. Gov. Mike Braun included the tax credit as a priority in his policy agenda released late last year.

The overall goal is to shift lower-wage, underskilled workers into unfilled, higher-paying jobs in emerging industries. State leaders have said the effort could lead to a better quality of life for many Hoosiers.

To be eligible, a business must have more than five employees and a worker being trained must have worked full-time for the company the previous calendar year.

Indy Chamber President and CEO Matt Mindrum told IBJ that chamber members are “big fans” of the tax credit. At a recent meeting, he said a large number of business owners said they were interested in taking advantage of the credit if it was included in the budget.

“If anything, we think the amount of money that’s been allocated in the current budget probably won’t go as far as we need to go,” he said. “It’s a huge step in the right direction. We hope there’s more investment to follow.”

The House included the credit in its biennial state budget bill, and the Senate will soon debut its version. Adams said the tax credit is expected to remain included in the bill.