Obama retools tax idea for jobs

BALTIMORE (AP) — President Barack Obama renewed his call for tax incentives to create jobs Friday, saying a greater effort is needed even though his administration has “stopped the flood of job losses.”

Obama wants to give companies a $5,000 tax credit for each net new worker they hire in 2010. Also, businesses that increase wages or hours for their existing workers in 2010 would be reimbursed for the extra Social Security payroll taxes they would pay.

No company could reap more than $500,000 from the combined benefits, one of several features meant to tailor the program more to small businesses than to large corporations.

House Democrats rejected a similar proposal last month after questioning how it would work. On Friday, some GOP lawmakers called the retooled plan too tepid; Rep. Mike Pence of Indiana described it as “a tax credit which was last promoted by President Jimmy Carter.”

But Obama urged Congress to enact it, saying economists consider it an effective way to spur job growth.

“It’s time to put America back to work,” the president told workers after touring the Chesapeake Machine Company in Baltimore. “We’ve had two very tough years. And while these proposals will create jobs all across America, we’ve got a long way to go to make up for the millions of jobs that we lost in this recession.”