Monday, October 09, 2006
Business rips Congress for failing to pass R&D tax credit
One of the big myths is that the Republicans help American business.
The reality is that could foul up a one-car parade.
This was something that's been in my mailbox a few weeks.
The R&D Credit Coalition is a group of more than 85 trade and professional associations and more than 1,000 small, medium and large companies engaged in U.S.-based research throughout major sectors of the U.S. economy, including aerospace, agriculture, biotechnology, chemicals, electronics, energy, information technology, manufacturing,medical technology, pharmaceuticals, software and telecommunications.
On September 13th, they delivered the following letter (excerpted) to the congressional leadership:
The undersigned companies represent American innovation. We are the idea generators and risk takers who want to continue investing, hiring and conducting research in the United States. The research and development tax credit (R&D credit) expired more than eight months ago. The lapse of the credit and accompanying uncertainty have increased the costs of U.S.-based R&D. As such, it is increasingly more difficult for us to commit to future high-risk, high-dollar R&D investments that would create high-wage jobs in the United States.
Granted, many companies also spend it on a lot of things that aren't in any way, shape, or form R&D, but it does serve to give an edge to innovative companies. Anyway, they continue:
Companies are forced to make critical R&D investment decisions under a cloud of uncertainty that is affecting current projects and future plans. Congress should put an end to the tax on American innovation and act swiftly to restore and strengthen the federal R&D tax credit.
Signatories range from the American Gas Association to the Indiana Manufacturers Association, from 3M to Adobe Systems, from Red Hat to Rohm and Haas,
The Timken Company... you name it.
Senator Max Baucus said this: “There are companies who now have to restate their financials because of Congress’s failure to pass [the R&D tax credit] which expired last year. It’s not been law for nine months now. They have to start restating their financials because of Congress’s ineptitude, Congress’s incompetence in not passing and continuing the research and development tax credit, teacher’s deduction, tuition deduction, sales tax deduction,” said Baucus. “The competency of this Congress in doing its business is now very much in question.”
That's a very important point. It's not just money that companies lose. By being forced to restate financials, they lose credibility with their investors.
The Republican Party. Bad for business. Bad for workers. Bad for America.
More blogs about politics.