Congresswoman Claudia Tenney (NY-24) introduced the Fostering Innovation and Research to Strengthen Tomorrow (FIRST) Act, to enhance the research and development (R&D) tax credit for small businesses and startups, allowing them to create jobs and boost American innovation.
“Now more than ever, the United States must work to out-compete and out-innovate our adversaries by investing in proven policies like the R&D tax credit,” said Congresswoman Tenney.
“Once a leader in promoting R&D, the United States has recently fallen behind other countries around the world who are offering greater R&D incentives. China, in particular, has chosen to invest heavily in R&D by providing a “super deduction” for R&D expenses. By enhancing the R&D tax credit, we can help small businesses and entrepreneurs across America invest in innovation that will unleash economic growth and create jobs on American soil. The FIRST Act is a crucial step in boosting American innovation and advancing our competitiveness on the world stage, reinforcing our nation’s position as the economic powerhouse of the 21st century.”
“Manufacturers in the United States perform more than half of all private-sector research and development in the nation, driving more innovation than any other sector," said Chris Netram, Managing Vice President, Policy, at the National Association of Manufacturers. "The Fostering Innovation and Research to Strengthen Tomorrow Act recognizes the importance of R&D in creating well-paying U.S. jobs and supporting innovation. We thank Rep. Tenney for her leadership in ensuring that manufacturers in the U.S. continue to be the world’s leading innovators.”
Specifically, this bill would:
Increase the "Traditional" Credit to 40 Percent: Established companies would see their current traditional credit rate, determined by a complex formula, boosted from 20 percent to 40 percent of the increase in R&D spending.
Raise the Alternative Simplified Credit (ASC) to 28 Percent: The existing ASC rate, calculated through a simpler formula, would be raised from 14 percent to 28 percent of the increase in R&D spending.
Significantly Enhance the Credit for Firms with Limited Research History to 14 Percent: Companies without any U.S. research track record in the past three years would experience a more than twofold increase in the credit from 6 percent to 14 percent of R&D spending.
