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Gov. Scott Walker (R) signed tax credit legislation Sept. 18 that will bring a $10 billion Foxconn Technology Group manufacturing campus to Wisconsin, calling the development a “transformational step” for his state.
Walker signed Special Session A.B. 1, granting $3 billion in tax credits, exemptions, and subsidies to Foxconn for its plan to construct a 20 million-square-foot campus in southeastern Wisconsin. Foxconn plans to produce liquid crystal display panels for televisions and electronic devices. The company plans to spend $10 billion on the project and promises to create up to 13,000 jobs.
“This is a truly transformational step for our state, our people, and our economy, and Wisconsin is ready,” Walker said in a statement. “Through Foxconn’s historic $10 billion investment and the creation of 13,000 new family-supporting jobs, the most high-tech, cutting edge technology in the world will be made in America, right here in Wisconsin.”
Foxconn is the operating arm of Taiwan-based Hon Hai Precision Industry Co.
A.B. 1 authorizes the Wisconsin Economic Development Corporation to issue up to $2.85 billion in income and franchise tax credits to Foxconn. Foxconn would have to meet certain job-creation and investment targets to claim the credits. The legislation also permits a $150 million sales and use tax exemption on purchases of building materials, supplies, and equipment used for the construction project.
Democratic lawmakers released a statement questioning the wisdom of the Foxconn special legislation. The group called the bill “the most costly state-funded tax credit package ever offered to a foreign corporation in U.S. history.”
A legislative report previously estimated that Wisconsin wouldn’t reach a “break-even point” in terms of state tax dollars until 2043. At that point, Wisconsin would begin to see positive tax collections from the project of $115 million per year.
“Giving $3 billion to a foreign corporation with a terrible record of keeping its promises is a political stunt that will harm Wisconsin for a generation,” said Sen. Mark Miller (D), chair of the Senate Democratic Caucus.
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Text of special session A.B. 1 is at http://src.bna.com/sEl.
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