The House passed the bill on March 4. The HIRE Act, H.R. 2847, now goes to President Obama to sign into law.
“People in the Northern Mariana Islands need jobs,” says Congressman Gregorio Kilili Camacho Sablan.
“The HIRE Act makes it less expensive for employers to hire workers and rewards employers for keeping new hires on the payroll. With our private sector economy shrinking and government laying off workers this is the kind of help we need.”
The centerpiece of the bill gives employers a break from paying the 6.2 percent Social Security tax for the remainder of 2010 on any new workers they hire who had been unemployed for at least 60 days. The new worker would also be free of the 6.2 percent Social Security tax.
Anyone hired between February 3, 2010 and January 1, 2011 qualifies, if they have been unemployed or underemployed.
Employers would also get a $1,000 tax credit for each of those workers who stays on the payroll for at least one year.
Because the tax credit would come out of the CNMI Treasury, which is already short of resources, Sablan and the other territorial delegates have been working together since last year to make sure that their local governments would be reimbursed by the U.S. Treasury in the jobs bill.
“Any $1,000 tax credit that is claimed will be paid for by the U.S.,” says Sablan.
“This is the same arrangement that we worked out for the Making Work Pay tax credit contained in the American Recovery and Reinvestment Act.”
Making Work Pay provided a tax credit of up to $400 for individuals and $800 for those filing joint returns. Money to make up the shortfall for the CNMI government is covered over regularly by the U.S. Treasury.
In addition to the tax provisions encouraging hiring the HIRE Act also provides highway fund for Fiscal Year 2010. The CNMI will receive $4.5 million for its highways. This money, too, is expected to create jobs and help stimulate the local economy.
