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ERIC Number: ED508322
Record Type: Non-Journal
Publication Date: 2009-May
Pages: 22
Abstractor: ERIC
Reference Count: N/A
The Fiscal Impact of a Corporate & Individual Tax Credit Scholarship Program on the State of Indiana. School Choice Issues in the State
Stuit, David
Milton & Rose D. Friedman Foundation
Indiana legislators are currently debating the merits of a proposal to adopt a statewide tuition scholarship tax credit program. The proposed program would make available $5 million in tax credits that businesses and individuals could claim by making donations to non-profit Scholarship Granting Organizations (SGOs). SGO donations would be matched at 50 percent, meaning that the state would provide a 50 cent tax credit for each dollar donated to a SGO. SGOs would in turn distribute scholarships for families to use towards private schooling costs. Eligibility for the program is restricted to students who were not enrolled in private schools in the previous school year and whose household income is at or below 200 percent of the federal free and reduced-price lunch program. Students who received a scholarship in the previous school year from a qualifying non-profit are also eligible. The purpose of this study is to project the impact of this program on the state's public education costs. It forecasts the immediate costs of the program in foregone state tax revenue and the potential cost savings that result if public school students use the scholarships to migrate to private schools. These estimations will allow policymakers and taxpayers to evaluate the merits of the policy in the context of its financial implications for the state. Findings reveal that the tax credit scholarship program will result in savings to the state, regardless of demand. The program is estimated to produce cost savings at any scholarship amount between $500 and $5,000. (Contains 4 figures, 10 tables, and 13 endnotes.) [This study was released jointly by the Friedman Foundation for Educational Choice, the Alliance for School Choice, School Choice Indiana, Indiana Non-Public Education Association, Indiana Catholic Conference, Agudath Israel of America, and the Educational Choice Charitable Trust.]
Milton & Rose D. Friedman Foundation. Available from: Foundation for Educational Choice. One American Square Suite 2420, Indianapolis, IN 46282. Tel: 317-681-0745; Fax: 317-681-0945; e-mail:; Web site:
Publication Type: Numerical/Quantitative Data; Reports - Research
Education Level: Adult Education; Elementary Secondary Education
Audience: Policymakers
Language: English
Sponsor: N/A
Authoring Institution: Friedman Foundation for Educational Choice
Identifiers - Location: Indiana