As we head into 2019, America is a global leader in innovation. That’s according to the just-released 2019 Bloomberg Innovation Index, which included the United States in its annual rankings of the “Top 10” most innovative economies.
In the U.S., manufacturers spend more on R&D than any other industry. R&D is the lifeblood of manufacturing and is what helps to spur innovation, competitiveness and the creation of good, high-paying jobs. It’s what helps manufacturers create the innovative products that Americans consume every day. That is why a tax code that encourages R&D is a key priority to ensuring continued growth in the U.S. manufacturing industry.
However, while manufacturers can immediately deduct R&D spending under the current tax code, beginning in 2022 they will have to deduct R&D costs spending over a period of years, making investments in research and development more costly. As the Congressional Budget Office recently warned, this change “will reduce the incentive to invest in R&D.” Manufacturers are riding a historic surge in optimism and demonstrating strong job growth. Making it more costly to innovate is the last thing manufacturers (and the U.S. economy) need.
The NAM continues to engage Congress on this issue. A letter sent to a bipartisan group of lawmakers highlights this critical issue. Moreover, as a founding member of the R&D coalition, the NAM is working with other sectors of the economy to ensure that the tax code continues to support R&D. Doing so will not only help to ensure that manufacturers can continue to innovate, grow the economy and create high-paying jobs but also to ensure the U.S. continues to be a global leader in innovation.
Latest posts by David Eiselsberg (see all)
- NAM Submits Comments Calling for Treasury to Implement New Anti-Base Erosion Provision Consistent with Congressional Intent - February 13, 2019
- New Study Proposes Repealing Pass-through Deduction, Threatening Tax Reform’s Gains - February 8, 2019
- The U.S. Economy Is in the ‘Top 10 in Innovation’ Rankings, but a Tax Change Is Threatening R&D - January 24, 2019