In a major victory for manufacturers, the Senate passed a bill (by a 62-37 bipartisan vote) that would grant the president authority to complete trade deals that Congress could approve or reject, but not change. Senate passage of Trade Promotion Authority (TPA) paves the way for House consideration in June. TPA is considered crucial to finalizing the trade agreements currently being negotiated with the Asia Pacific (TPP) and the European Union (TTIP). This has been a hard-fought battle for manufacturers and other businesses that depend on fair, open trade to compete and it isn’t over yet. It is critical that members of the House of Representatives hear from MFG Advocates like you about the importance of this bill to American competitiveness. Visit www.congressweb.com/AMT for a sample letter and information on contacting your Representative.
Movement on expired tax provisions
Congress is moving to inject a level of certainty into the tax code incrementally by making permanent specific “tax extender” provisions. Last month, the House approved legislation to improve and make permanent the R&D tax credit by a bipartisan 274-145 vote. Thirty-seven Democrats supported the measure. The R&D tax credit, which has been extended more than a dozen times, expired at the end of 2014.
A bill introduced by House Ways & Means Committee member Pat Tiberi (R-OH-12) would make permanent another expired provision – 50 percent bonus depreciation (H.R. 2510). It allows businesses to expense 50 percent of their new capital equipment in the year that it is purchased and placed in service. H.R. 2510 has 23 cosponsors – 22 Republicans and one Democrat.
Business IRA bill to be introduced
Rep. Rosa DeLauro (D-CT) will reintroduce the Manufacturing Reinvestment Account Act, a business version of the Individual Retirement Account (IRA). The Manufacturing Reinvestment Account Act would allow companies to contribute up to $500,000 in pre-tax funds annually into a Manufacturing Reinvestment Account that would be opened at a local community bank. The money, which could be invested for up to seven years, would earn interest and could be withdrawn to pay for equipment purchases, facility expansion and job training. The money that is withdrawn for those expenditures would be taxed at a rate of 15 percent, rather than the 30 percent companies otherwise would pay. A state version of the bill was approved in the Congresswoman’s home state of Connecticut in 2012.
GOP COMPETES bill passes House
The House passed the America COMPETES Reauthorization Act of 2015 (H.R. 1806) by a 217-205 party-line vote. H.R. 1806 is barely recognizable from the bipartisan bill that was first enacted in 2007 to boost U.S. innovation and competitiveness through science and engineering research. H.R. 1806 would keep current funding levels but significantly redirect how and on what the research dollars are spent. Democrats and the scientific community are strong in their opposition, and the President has threatened a veto. One of the bill’s positives is that it restores the authorized funding level for Manufacturing Extension Partnerships to $130 million for both FY16 and FY17. AMT will be working to protect manufacturing interests as this bill moves through the process.
Read Penny Brown’s MFG Advocate column to find out how the Defense Department is collaborating with manufacturing organizations, including the MTConnect Institute, to help build a Smartforce.