Tax Incentives Before the Supreme Court Today

By March 1, 2006General

A critical case of importance to many manufacturers is being argued before the Supreme Court today, Cuno vs. Daimler-Chrysler. At issue are investment tax credits granted by the state of Ohio to Daimler Chrysler to locate a Jeep plant in Toledo, Ohio. Ralph Nader sued, claiming that these incentives discriminated against local businesses expanding within the state. The truth is that investment tax credits have long been recognized as valuable told for states and localities to attract investment in their states and localities.

States are competing in the global economy and this is one way to do that. The state of Kentucky, for example, has been repaid a hundredfold or more from its initial investment attracting Toyota to Scott County. That proved a good decision for local companies as well. The rising tide really does lift all boats, and businesses. Should the Naderites prevail here, it would end this practice of offering investment tax credits to lure manufacturing and other businesses to a given state. Incredibly, both labor and management are on the same side of the case. We have filed an amicus brief in this case, as has the UAW.

In any event, arguments are today, with Ted Olsen — a very bright and capable lawyer — arguing for our side. Here’s a link to our press release, outlining our view of the case. Maybe Nader should go back to running for President.

By the way, to see where your state ranks in terms of competitiveness, get a copy of our Competitiveness Redbook.