Economic development incentives

Connecticut

Northeastern US

Grant

JobsCT Grant Program: Eligible employers who meet certain eligibility requirements, including the creation of a minimum of 25 new jobs, will earn a grant-in-arrears equal to 25% of the withholding taxes from net new employees. Employers that locate or grow in a Distressed Municipality or Opportunity Zone are potentially eligible for a 50% grant. The grant can be earned for up to 9 years.

Tax Credits

Urban and Industrial Sites Reinvestment (URA) Tax Credit Program: This incentive program is used by the State to attract new business investment and job creation to economically distressed areas. Companies that invest at least $5 million in facilities located in eligible areas may be entitled to a non-refundable corporate income tax credit under this discretionary program. Tax credits are disbursed over a 10-year period.  Unused credits may be carried forward or transferred/sold to other Connecticut taxpayers.

Research and Development Tax Credit: Equal to 20% of R&D expenditures in Connecticut in the current income year exceeding R&D expenditures of the prior taxable year. Unsold credits can be carried forward up to 15 years, and for companies with less than $70 million in gross income, credits are partially refundable.

Tax Exemptions

Sales and Use Tax Exemption: The State has the discretionary authority to provide an exemption from state sales tax on the purchase of construction materials and furniture, fixtures and equipment for businesses that make capital investments and create jobs. Equipment, tools, machinery, supplies, materials, and fuel used in renewable energy and clean energy technology industries are also exempt from state sales and use tax.

Real and Personal Property Tax: Municipalities have the discretion to provide a negotiated exemption from real and personal property tax for up to 30 years. State statutes also provide for an exemption of tax on certain newly acquired and installed machinery, inventories, unbundled software, and commercial motor vehicle, dependent on certain conditions.

Data Center Tax Exemptions: 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 provides for an exemption from any future financial transaction taxes that the state may impose in the future. To qualify, data center facilities must make an investment of at least $50 million if the facility is locating in a qualifying Enterprise Zone or federal opportunity zone or make an investment of at least $200 million if locating elsewhere. Tax incentive agreements are entered into with DCED for qualifying data centers for a term of up to 20 years with extensions of up to 30 years for larger-scale investments.

Special Zoning

Enterprise Zone: Businesses that locate inside an Enterprise Zone, or within a community which contains a zone, may be eligible for an abatement on real and business personal property taxes of up to 80% for 5 years and a 10-year, 25% tax credit on the portion of the Connecticut corporation business tax that is directly attributable to the company relocation, expansion or renovation project. The credit may increase to 50% based on the number of new jobs created.

Last Updated: March 2022

Tax Credits

Incentives & Exemptions

Grant and Financing Programs

Special Zoning

Job Training

Financing & Financial Assistance

Local Incentives

Other Programs

Interested in Learning More?

Contact us today at 609.924.9775 or info@blsstrategies.comto schedule an initial incentives strategy consultation.
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