U.S. Rep. Ron Estes (R-KS) on Tuesday led 65 of his colleagues in introducing a bipartisan bill that would restore the deduction for research and experimental expenditures.
“Research and development [R&D] is critical for our American economy, and it’s imperative that we give American innovators the tools and incentives to conduct that R&D right here in the United States,” Rep. Estes said. “More R&D here at home means more jobs now and in the future.”
Rep. Estes sponsored the American Innovation and R&D Competitiveness Act, H.R. 2673, which U.S. Rep. John Larson (D-CT) signed on to as the lead original cosponsor to permanently allow for immediate R&D expensing, according to a bill summary provided by the lawmakers.
“Rep. Larson and I know that businesses and manufacturers in our districts and across the country need immediate R&D expensing and we’re joined by a number of our colleagues on both sides of the aisle that want to see this bill passed,” said Rep. Estes. “The time for waiting on immediate R&D expensing is over; Congress should pass the American Innovation and R&D Competitiveness Act now.”
Immediate R&D spending would incentivize long-term investments in innovation and technological breakthroughs by allowing a business to deduct R&D activities in the tax year that they occur, the summary says, noting that H.R. 2673 would repeal a section of the Tax Cuts and Jobs Act that required the amortization of R&D expensing over five years beginning in 2022.
R&D “play an integral role in creating good-paying jobs across the country, especially as we rebuild our economy from the impacts of the pandemic,” said Rep. Larson. “If we do not act to fix the R&D tax deduction, there will be serious repercussions on jobs and our economy.”
The Association of Equipment Manufacturers; BG Automation in Derby, Kan.; Wright-Pierce; and Tyson Foods endorsed the measure.