SPOTLIGHT PROGRAMS

JobsCT Tax Rebate Program: Eligible employers who meet specific requirements, including the creation of a minimum of 25 new jobs, can earn tax rebates equal to 25% of the withholding taxes from net new employees. Smaller employers (≤75 employees) may qualify with the creation of as few as 5 new full‑time equivalent jobs. Employers locating in Distressed Municipality or Opportunity Zone may qualify for a 50% tax rebate. Project salaries must pay the greater of (1) 85% of the median household income of the municipality where the project will be located or (2) $37,500. Employers must retain contracted employees for 24 consecutive months before any funds are disbursed. Businesses then commence rebates in year 3 through year 7 and the State has discretion to extend rebates for years 8 and 9.

Sales and Use Tax Exemption: The State offers various exemptions from state sales and use tax on certain purchases, including but not limited to manufacturing machinery & equipment, tools, fuel and materials used directly in the manufacturing, as well as certain biotech, R&D and clean/renewable energy equipment. The State may provide sales tax exemptions to other purchases, including but not limited to construction materials and furniture, fixtures and equipment, data center equipment for eligible businesses making significant capital investments and creating jobs.

TAX CREDITS

Urban and Industrial Sites Reinvestment (URA) Tax Credit Program: This program provides discretionary corporate tax credits for eligible investments in urban areas or on industrial sites, up to a maximum of $100 million per project. The project must add substantial new economic activity, increase employment and generate significant additional tax revenues to the municipality and the state.  In addition, companies must meet certain minimum investment thresholds - $5 million in a distressed communities,$2 million for historic preservation facility redeveloped for mixed use, or $50 million in all other communities. Credits can be used over a 10 year period and may be carried forward for up to 5 consecutive years. The credits may also be assigned to another taxpayer under certain conditions.  Companies cannot combine this credit with certain other Connecticut tax credits, including the Enterprise Zone  25% corporate tax credit for the same project.

Research and Development Tax Credit: The State offers both, incremental and non-incremental Research and Development Tax Credit for R&D expenses paid or incurred by the Company within the state. The incremental credit is 20% of the increase in qualifying R&D expenditures over the base amount while the non-incremental credit amount varies based on the company size and level of eligible spending. Unsold credits can be carried forward up to 15 years, and smaller companies with less than $70 million in gross income may be eligible for a partial refund equal to 65% of its value.

TAX EXEMPTIONS

Real and Personal Property Tax Benefits: Municipalities have the discretion to provide a negotiated  multiyear exemption from real and personal property taxes, typically tied to the job creation and capital investment. In addition, the State law provides for certain property tax exemptions ,including exemptions for machinery and equipment, inventories, certain software and commercial motor vehicles, dependent on certain conditions.

Data Center Tax Exemption: Passed in March 2022, the Data Center Tax Incentive provides sales and use tax exemptions and business personal property tax exemptions to owners and developers of qualifying data center facilities. The legislation also includes an exemption from certain taxes on the sale or transfer of the data center equipment that may be imposed by the State in the future. To qualify for a 20-year term, data center facilities located in a qualifying Enterprise Zone or federal opportunity zone must make an investment of at least $50 million; projects located elsewhere must invest at least $200 million. For a 30-year term, investment must be at least $200million in an opportunity zone or $400 million if located elsewhere.

Enterprise Zone: Certain eligible businesses that are located within a designated Enterprise Zone, or within a community which contains a zone, may be eligible for various benefits, including partial 5years real and personal property tax abatement, a 10 year 25% corporate tax credit on a portion of the corporate business tax directly attributable to the “project”,  and sales &use tax exemption on certain eligible purchases.  Property Tax abatement is a five-year program that offers up to 80% abatement of local taxes on qualified real estate and personal property (machinery and equipment). To qualify, the business must make significant capital investment, such as renovating facility by investing 50% of the facility’s prior assessed value, constructing /expanding an existing facility, or acquiring a new facility that has been idle for a required minimum timeframe.

Last updated:  May 2026