Assembly panel to weigh tax credits for hiring people recovering from drug addiction

Assembly lawmakers will weigh a bill Thursday encouraging businesses to hire individuals recovering from drug addiction.

The measure would provide businesses with gross income tax credits of up to $2,000 for each worker recovering from drug addiction, with the size of the award depending on how many hours an eligible employee works.

“We have to work collaboratively to give people a pathway out,” said Sen. Vin Gopal (D-Monmouth), the bill’s prime sponsor. “Motivating small business owners and companies to hire employees of all sorts and give them a second chance, I think, is only a good thing.”

To receive tax credits, which could reduce a business’s tax liability by no more than 50%, a business must demonstrate to the state that they have a formal working relationship with a recovery service or drug treatment provider, and they must offer employer-sponsored health insurance.

Eligible employees must individually work at least 500 hours during a calendar year to earn their employer a tax credit. The bill would set $2 million aside to make up for the reduced tax collections.

“The state has invested for a while in second chances,” Gopal said. “This is an important way to continue that.”

New Jersey lawmakers have turned to tax credits to encourage hiring before. The Senate’s health committee Monday advanced a bill that would offer tax credits to improve employee retention at child care centers, which, like many other fields, have faced a labor shortage caused by the pandemic.

Tax credits for hiring residents recovering from drug addiction could help fill employment gaps in other sectors, Gopal said.

It’s not clear when a Senate committee will weigh Gopal’s bill. The Senate Economic Growth Committee, to which the bill was referred, does not have any meetings scheduled.