Washington-- U.S. Senator Evan Bayh today announced the passage of a major economic initiative that will create new Hoosier jobs and provide important tax relief for Indiana's manufacturers without costing taxpayers a dime. The Jumpstart Our Business Strength (JOBS) bill passed overwhelmingly and includes important economic benefits that will start helping Indiana's economy beginning this year, with the full benefits scheduled to be in place by 2009.

"The JOBS bill is a serious shot in the arm for Indiana's economy," Senator Bayh said. "It means more jobs for hardworking Hoosiers and crucial support for Indiana's 11,000 manufacturers as they compete against companies from overseas. Best of all, the money used to spur our economy will come at no cost to honest taxpayers, coming instead from closing down tax shelters and forcing unpatriotic corporations to pay their fair share of taxes."

The JOBS bill encompasses a wide variety of initiatives designed to strengthen the economy, including a nine-percent tax deduction for manufacturers that will effectively lower manufacturers' top corporate tax rate from 35 percent to 32 percent. The tax deduction is available to all American manufacturing companies, meaning that all of Indiana's 11,000 manufacturing companies can qualify for the deduction. The tax deduction can be used by companies to hire more workers and invest in high-tech equipment, making Indiana manufacturers more competitive in the global market-place. A second provision will encourage small businesses to invest in high-tech equipment by allowing them to expense up to $100,000 in new investments for an additional two years through the end of 2007.

Bayh's amendment, along with his support of other initiatives included in the JOBS Bill, will help spur economic development and job creation for manufacturers across the country, and especially in Indiana. Indiana remains the number-one manufacturing state in the country based on the percentage of manufacturing jobs (20 percent) in the state.

Below is a brief description of Senator Bayh's efforts:

In 2003, Bayh introduced legislation to close the Bermuda loophole, which allows companies to use an overseas post office box to avoid domestic taxes. A modified version of Bayh's legislation was included in the final Conference Report, which effectively removes the tax benefits for companies that attempt to avoid taxes this way after March 2003.

Bayh's amendment closing a tax law loophole for foreign arrow manufacturers will help provide a level playing field for Hoosier manufacturers facing unfair competition from overseas. Currently, companies like Easton Technical Products in Monticello, Indiana are forced to compete against foreign companies that can sell their finished arrows at a 12.4 percent price advantage by taking advantage of a tax law loophole. The Monticello plant employs 70 Hoosiers and generates revenues of $11 million per year for Easton Technical Products.

Bayh also fought for new tax credits to increase the production of ethanol and biodiesel, which were also included in the JOBS bill.

The manufacturing sector plays a vital role in the Indiana economy, accounting for a significant portion of jobs across the state. Despite the recent economic downturn, Indiana's manufacturing workforce has remained strong compared to other states. The percentage of manufacturing jobs in Indiana is 20.2 percent, which is high when compared to the average percentage of manufacturing jobs in other states, 11.2 percent.

###