Hon Hai Precision Industry Co (鴻海精密), known internationally as Foxconn Technology Group (富士康科技集團), has qualified for nearly US$30 million in Wisconsin tax credits, marking the first time that the electronics giant has secured state aid since breaking ground on its facility in the state in 2018.
The Wisconsin Economic Development Corp (WEDC) on Wednesday verified that Hon Hai had met job creation and investment benchmarks to qualify, based on documents provided to the Wisconsin State Journal.
Hon Hai last year created 579 eligible jobs and made a capital investment of US$266 million at the Racine County facility, which qualifies the company for US$2.2 million in job credits and US$26.6 million in capital investment credits, the Wisconsin State Journal reported.
Photo: Ann Wang, Reuters
“The WEDC has determined that Foxconn created sufficient jobs and invested sufficient capital expenditures to qualify for tax credits under its amended contract,” WEDC secretary Missy Hughes said in a statement.
Hon Hai, best known for making Apple iPhones, failed to qualify for state funds during the first two years of its previous contract, but Wisconsin and Hon Hai reached a new six-year deal for the project.
Under the new contract, Hon Hai was eligible for about US$29 million in performance-based tax credits for last year.
Hon Hai reported on June 30 that by the end of last year, it had created 970 jobs at the Mount Pleasant facility. The WEDC verified that 579 of those jobs were eligible, which was well above the minimum requirement of 481 jobs and nearly reached the target goal of 601 jobs.
Under the new contract, Hon Hai could receive up to US$80 million in state tax funds as long as it creates at least 1,454 jobs and makes a capital investment of at least US$672 million by 2026.
Hon Hai’s original contract, signed by former Wisconsin governor Scott Walker in 2017, promised the company US$3 billion in state subsidies if it made a US$10 billion investment and hired 13,000 employees over a 15-year period.
Other state and local incentives, including US$150 million in sales tax breaks that the company still could receive, brought the total to about US$4 billion.
Under the company’s new agreement with the state, which is similar to other performance-based incentive packages provided to companies, Hon Hai could earn tax incentives without specific requirements on what the company produces as long as it meets hiring and capital investment targets.
The contract also memorializes the potential for future investment and qualifying for added tax incentives from the state.
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