COLCHESTER, Vt. – Gov. Peter Shumlin signed the Veterans’ Tax Credit act at Camp Johnson today as Vermont National Guard members looked on.
The new legislation will give employers a $2,000 tax incentive to hire soldiers who have returned from deployments in Afghanistan or Iraq in the last two years. In order to qualify for the tax credit, businesses must employ veterans between now and the end of 2011. Veterans who start new companies this year can also apply for the benefit.
Shumlin, a Democrat, asked the Legislature to take up the tax credit proposal in early February, shortly after Adj. Gen. Michael Dubie told lawmakers that one-third of service members returning from deployments in the Middle East were unemployed. The legislation had strong support from the Democratic majority in the Vermont House and Senate.
Shumlin thanked Dubie for “bringing the problem to our attention.”
“As a state, we are proud of the men and women who have served for us,” Shumlin said. “We owe them something, and if you have a job and there are two or three of four people in line for that job, we’re asking you to hire our returning veterans.”
The Veterans Administration estimates that the credit to employers of veterans will be available for 75 percent of the estimated 377 unemployed veterans in Vermont. The total cost is expected to be about $560,000. An amendment made to the bill by the House Committee on Ways and Means also provides a $2,000 tax credit for businesses started between the bill’s signing and the year’s end in which a recently deployed veteran has at least 50 percent share. The new business must make at least $3,000 profit for the credit to apply.
Republicans in both chambers raised concerns about the bill’s efficacy, as did Democratic Sen. Peter Galbraith, a former diplomat who represents Windham County.
Galbraith said of the signing, “Well, I won’t be there.” Not only because he happened to be in Norway at the time, he said, but also because he felt the bill was “an empty gesture.”
Shumlin responded to this criticism of the bill at the press conference. “I think it’s dead wrong,” the governor said. “I think that if you give a $2,000 tax credit to an employer in Vermont, it makes a difference.”
The governor argued that the legislation would move veterans to the front of the job application line.
House Speaker Shap Smith, D-Morrisville, who was on hand for the ceremony, said: “It is our hope that this will spur hiring for veterans, and we know that members of the military tend to be very, very good employees, and oftentimes employers are already looking for that kind of experience on a resume.”
Lawrence Miller, secretary of the Agency of Commerce and Community Development, said the veterans tax credit was “not about creating jobs.”
“We’re trying to make sure that employers consider this highly qualified pool of applicants and make sure they reach out to this pool of applicants,” Miller said.
“No employer is going to hire a veteran over anyone else for a $2,000 tax credit,” Illuzzi said.
Galbraith described the tax break as a “giveaway” that would go to employers that would hire a veteran anyway.
Both Sens. Galbraith and Illuzzi said the money would be better spent on education and job training for veterans.
“The reason that there are long-term unemployed veterans is that they don’t have the education or job skills,” said Galbraith.
Sen. Dick McCormack, D-Windsor, the reporter of the bill for the House Finance Committee, said the bill recognizes Vermonters who have served the country.
“I think it’s more of a statement of respect and appreciation,” said McCormack. “I’m not sure about how much financial good it will do veterans, but certainly it won’t hurt.”
Another bill, H.38, signed at the event is intended to “remove barriers to success imposed on children of military families because of frequent moves and deployment of their parents.”
The bill facilitates the timely enrollment and transfer of records for children of service members, along with providing excused absences for children to spend time with their parents if the parents have been called for duty or have just returned from a deployment.
