ASSEMBLY COMMUNITY SERVICES COMMITTEE

STATEMENT TO

ASSEMBLY, No. 1172

with committee amendments

STATE OF NEW JERSEY

DATED: JUNE 3, 1996

      The Assembly Community Services Committee reports favorably Assembly Bill No. 1172.

      As amended, this bill provides for a tax deduction under the gross income tax for taxpayers operating or maintaining a licensed child care service for their employees' children, or who have paid part or all of the cost of outside child care services for children of employees. The deduction is equal to 25% of the expenses incurred.

      The bill allows for the child care expense deduction for certain resident employers to be in cooperation with one or more unincorporated businesses. This is to act as an incentive for small businesses to form a consortia with other small businesses and then be able to provide child care for its employees.

      The committee amendment is technical in nature and changes the effective date so that it is applicable to tax years beginning on or after January 1, 1996.

      This bill was prefiled for introduction in the 1996-1997 session pending technical review. As reported, the bill includes the changes required by technical review which has been performed.