Alabama Republican Party

Alabama Republican Party Chairman Mike Hubbard on Friday condemned successful efforts by House Democrats to prevent a health insurance tax credit for small business from being included in the state budget.

“The Democrats claim to be the party that supports health care for individuals, yet they blocked this important Republican legislation that would provide quality health insurance for thousands of Alabamians across the state,” Hubbard said. “At the same time, the Democrats prevented thousands of small business owners across the state from receiving a tax credit that could make a great difference in their bottom line.”

As part of Gov. Bob Riley’s economic stimulus and job creation package, Republican legislators supported a plan that allowed small businesses to deduct twice the amount they pay for employee health insurance coverage from their state income taxes. And, in order to ensure that employees participate in their employers’ health insurance plan, workers could also deduct twice the amount they pay for their coverage.

During debate over the state’s almost $7 billion Education Trust Fund budget on Thursday, Rep. Jay Love (R – Montgomery) offered an amendment that would provide $6.7 million in funding for the small business tax credit. The amendment would reduce an increased appropriation for the state’s two-year college system, which is mired in an on-going scandal involving fiscal mismanagement and criminal behavior, and, instead, devote that money toward providing the tax credit.

Democrats voted overwhelmingly against the amendment, which died on the House floor.

Hubbard, who represents Auburn in the Alabama House and also serves as his party’s caucus leader, noted that the tax credit would have applied only to companies with 25 employees or less, which covers more than 90 percent of the businesses currently operating in the state, and only those employees with an adjusted gross income of less than $50,000.

“Rather than rewarding small business owners for being the backbone of our state’s economy, the House Democrats chose to reward the two-year college system for engaging in waste, fraud and corruption,” Hubbard said. “Every small business owner should look at this vote and decide for themselves which party is on their side.”