The investment credit law does not require companies to create jobs to be eligible for the benefit.

"We should give hotels investment credits but not an income tax incentive.

Ohio's brief said that 46 states offer some form of investment credit, often identified with special enterprise zone programs.

In that sense, they say, the housing investment credit resembles the handouts tax reform was intended to stop.

The budget allowed for $5,400 million in foreign investment credits, to be repaid in full within five years.

Without the "incremental" feature, many economists figure that the investment credit would be far too expensive to justify.

In the mid-1980s, the greatest portion of investment credits went to the industrial sector, followed by agriculture, construction, and retail trade.

Faced with a loss of manufacturing jobs, the state has offered a range of investment credits and other attractive features.

Still, some economists present the investment credit as a miracle cure, a tonic with no deficit hangover.

Unfortunately for both boosters and detractors of the investment credit, its chaotic history provides no solid lesson.

The 1986 tax bill removed from business the investment credit, lowered depreciation rates and removed capital gains.

Still, three years ago a tax reform commission appointed by the Governor recommended eliminating some of the business tax breaks, including the 1985 investment credit.

He also played a role in crafting the Revenue Act of 1962 that established a 7 percent investment credit to spur industrial growth.

Many critics have faulted the state's investment credit, which permits companies, mainly manufacturers, to write off a share of their investment costs.

If they qualify for the investment credit, would companies that do not qualify because their investments are declining simply decide to lease equipment instead?

Investment Credit Under the new plan, the investment tax credit will be reduced on a graduated basis from its current rate of 6 percent.

And tax reform in 1986 eliminated most of the industry's lucrative depreciation and investment credits, spurring the drive for new customers.

For corporations as a whole, the rate reduction was offset by other changes, most significantly reduced depreciation write-offs and elimination of the investment credit.

Congress passed a series of bills providing protective tariffs as well as investment credits and loan guarantees for new ethanol plants.

It was also evident that SMEs were experiencing considerable difficulty in obtaining commercial and investment credits.

Democrats have argued that investment credits cut unevenly between industries and companies within industries, and distort rational economic thinking.

State officials say the poultry and feed industry has thrived because of sales tax exemptions, investment credits and extremely low severance taxes on natural gas.

The corporate tax rise might hurt capital-intensive companies, like chemicals or machinery, least because they can write off their equipment and would now benefit from investment credits.

Senator Cohen said the Puerto Rican investment credit "has become a tax incentive that rewards the spiraling escalation of drug prices."

When a country is decertified it becomes ineligible for most American aid, and the President can also apply some trade sanctions and withhold investment credits.