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“YES” on H.R. 4438, the American Research and Competitiveness Act of 2014
May 7, 2014
NTU urges all Representatives to vote “YES” on H.R. 4438, the American Research and Competitiveness Act of 2014. This legislation would simplify and make permanent the 20 percent tax credit for research and development expenses.
Short of enacting comprehensive tax reform that would streamline the law and lower the U.S.’s excessively high corporate tax rate, making permanent the research and development tax credit is an important step toward creating a healthier business climate, providing broad-based relief, and promoting economic growth. Investing in innovation is an economic boon, not only for businesses, but also for taxpayers and consumers. However, it can come with a significant price tag, often involving multi-year strategies. Forcing businesses to try to plan for long-term activities around one- or two-year extensions of tax policy leads to increasingly complex, inaccurate accounting, potentially penalizing the risk-taking that often results in economic expansion.
The research and development tax credit is a compromise in lieu of full expensing. However, in order to maximize its effectiveness it should be permanent, because businesses need a stable tax structure to anticipate the terms on which they will be competing. Already, the expiration of the research and experimentation tax credit at the end of 2013 is creating a drag on earnings across various sectors of the economy, making the passage of H.R. 4438 all the more urgent.
Roll call votes on H.R. 4438 will be significantly weighted in NTU’s annual Rating of Congress and a “YES” vote will be considered the pro-taxpayer position.
If you have any questions, please contact NTU Federal Affairs Manager Nan Swift at (703) 683-5700