Companies that perform domestic research and development activities that lead to products being manufactured in the United States would benefit from a new tax credit under legislation introduced by U.S. Rep. Mike Kelly (R-PA) on Tuesday.
Kelly said he introduced the Invest and Manufacture in America Act, H.R. 3068, in response to the “unacceptable trend” of more than 70,000 U.S. manufacturing plants closing since the turn of the 21st century, leading to more than 5 million manufacturing jobs lost.
“Scientific research and technological innovation are massive economic drivers that need to be supported,” Kelly, a member of the House Ways and Means Committee, said. “Manufacturers not only strengthen our economy and provide good jobs but also help create separate jobs in supporting industries. It just makes sense to encourage both R&D and manufacturing to take place domestically. By making it easier for companies to carry out the entire production process here in America, from conception to creation, we can rejuvenate our entire manufacturing sector and help new jobs be created for Americans. I call on my colleagues in both parties and both houses to support this common sense bill.”
Keith Roe, the president of the American Society of Mechanical Engineers, said the new tax credit would amplify the success of the R&D tax credit by creating new benefits for American workers.
“When American innovations are manufactured abroad, we surrender our competitive advantage,” Roe said. “This bill will strengthen innovation at home and make the United States more competitive globally by encouraging more domestic R&D and manufacturing. When goods and technologies are manufactured where they are invented, it promotes further advances and allows the entire innovation pipeline to reinvigorate itself more quickly.”
U.S. Sen. Pat Roberts (R-KS), who introduced a Senate version of the bill earlier this month, agreed that research and development of new technologies and products are important sources of economic growth.
“The new technologies, products and lower prices generated by investments in R&D create new jobs, raise wages and create new demand for goods and services,” Roberts said. “Our legislation would increase cash flow for small businesses and start-ups involved in R&D intensive activities by reducing past, current and future tax liabilities leading to permanent tax savings.”