Since the year 2000, South Carolina has lost more than 123,000 manufacturing jobs. Many of those jobs have moved overseas. That has to change, and we can change it.
Great countries are countries that make things. And we need to keep America great. So let’s give American companies an incentive to make things right here in America.
One way to do it is to create a new American Manufacturing Tax Credit for companies that manufacture their products in the United States. It will help American companies and it could create tens of thousands of new American jobs.
Here’s how it would work:
• Right now, a company can claim an R&D tax credit in one of two ways. Those methods peg the credit either to a firm’s historic R&D spending or gross receipts. The credit is capped at an amount set by law.
• Our plan would give companies a bonus credit of up to 10% on top of that cap if they manufacture a majority of their products in the United States. The more products the company manufacturers in the United States, the bigger the tax credit would be. But a company wouldn’t qualify for the new credit unless it derived at least half of its total gross production receipts from products made right here in America.
• We’d also make the credit refundable, meaning that companies could collect even if they showed a loss and didn’t have taxable income at the end of the year.
We should also make the Research and Development Tax Credit permanent. In most years, Congress reauthorizes the existing credit, but sometimes they don’t. This uncertainty injects unneeded financial risk into the R&D process and it makes for difficult tax planning. We should make it easier, not tougher, for our most innovative companies to develop new products. Making the R&D tax credit permanent would go a long way toward accomplishing that goal.
This simple idea could generate significant job growth. More than 70% of all the dollars that companies receive for the R&D credit go directly to pay the salaries of American workers. And since almost a third of the companies claiming the R&D tax credit were companies with assets of $1 million or less, the new credit will be a big help for some of our most innovative small business.
This is the third of 52 ideas, one per week for the entire campaign. Send us your ideas, too. Nothing is too big or too small. If the ideas are good ones, we'll put them on the list. We can make things better, one thing at a time. Submit your ideas to chad@chadmcgowan.com.
Great countries are countries that make things. And we need to keep America great. So let’s give American companies an incentive to make things right here in America.
One way to do it is to create a new American Manufacturing Tax Credit for companies that manufacture their products in the United States. It will help American companies and it could create tens of thousands of new American jobs.
Here’s how it would work:
• Right now, a company can claim an R&D tax credit in one of two ways. Those methods peg the credit either to a firm’s historic R&D spending or gross receipts. The credit is capped at an amount set by law.
• Our plan would give companies a bonus credit of up to 10% on top of that cap if they manufacture a majority of their products in the United States. The more products the company manufacturers in the United States, the bigger the tax credit would be. But a company wouldn’t qualify for the new credit unless it derived at least half of its total gross production receipts from products made right here in America.
• We’d also make the credit refundable, meaning that companies could collect even if they showed a loss and didn’t have taxable income at the end of the year.
We should also make the Research and Development Tax Credit permanent. In most years, Congress reauthorizes the existing credit, but sometimes they don’t. This uncertainty injects unneeded financial risk into the R&D process and it makes for difficult tax planning. We should make it easier, not tougher, for our most innovative companies to develop new products. Making the R&D tax credit permanent would go a long way toward accomplishing that goal.
This simple idea could generate significant job growth. More than 70% of all the dollars that companies receive for the R&D credit go directly to pay the salaries of American workers. And since almost a third of the companies claiming the R&D tax credit were companies with assets of $1 million or less, the new credit will be a big help for some of our most innovative small business.
This is the third of 52 ideas, one per week for the entire campaign. Send us your ideas, too. Nothing is too big or too small. If the ideas are good ones, we'll put them on the list. We can make things better, one thing at a time. Submit your ideas to chad@chadmcgowan.com.
