The House Committee on Tax Policy today approved a resolution sponsored by state Rep. Mark Tisdel, the majority vice chair of the committee, calling on Congress to strengthen the Work Opportunity Tax Credit, which helps small businesses hire people most in need of a job.

“Jobs provide financial stability and forge economic opportunity,” said Tisdel, of Rochester Hills. “Congress should improve the Work Opportunity Tax Credit to help people obtain jobs to provide for themselves and their families. Workers and employers alike have suffered hardship because of COVID-19, and a more robust tax credit could be a key element for recovery.”

Congress created the WOTC in 1996 to help businesses hire employees in need. Employers are eligible for the tax credit by hiring workers from targeted groups. Examples of targeted groups include veterans with a disability or facing economic hardship, and certain recipients of Supplemental Nutrition Assistance Program (SNAP) benefits, Supplemental Security Income (SSI), and other forms of aid.

Tisdel’s House Resolution 198 urges Congress to approve legislation to strengthen the WOTC. The measure praises the tax credit for encouraging “businesses to hire employees in certain groups that face significant barriers to employment” by helping employers “defer the costs of recruiting, training, and employing these individuals.” However, the resolution states, the credit “has not kept up-to-date with rising labor costs.”

HR 198 cites the pandemic as a reason to improve the tax credit.

“The economic effects of the COVID-19 pandemic have made it more important than ever to strengthen the WOTC,” it reads. “The credit targets jobs to those groups that have been disproportionately impacted by the pandemic. Increasing the credit amount will also help businesses to recover from the pandemic by defraying the costs of hiring these individuals as labor costs rise.”

HR 198 now proceeds to the entire House of Representatives for consideration.