On March 17th, US local time on Tuesday, representatives of Intel and Ford Motor Company claimed that unless the US Congress provides more incentives for domestic production, foreign semiconductor, electric vehicle battery and drug manufacturers will continue to squeeze the US manufacturing industry. .

Intel Chief Financial Officer George Davis (George Davis) said at the Senate Finance Committee hearing that lawmakers should consider measures, including funding and increasing tax incentives, to allow the United States to produce more advanced micro-processing chips. Both Democratic and Republican lawmakers have admitted that these chips are essential to ensuring national security.

Davis said: "If you look at those areas where semiconductor manufacturing has seen substantial growth, you will find that those areas have coordinated policies to encourage investment, but the United States has not yet taken these measures."

Both major political parties in the United States support the revitalization of American manufacturing. Senate Majority Leader Chuck Schumer and Republican Senator Todd Young are formulating proposals aimed at improving the competitiveness of the United States. The Senate may consider this proposal within a few months, and the proposal includes new funding for semiconductor manufacturers to build new factories and create regional innovation centers.

Ron Wyden, chairman of the Senate Finance Committee, said at the hearing: "The supply chain crisis has sounded the alarm for the semiconductor industry. Semiconductors are a key component of automobiles, medical equipment, household appliances, mobile phones, computers, and defense technology. Part, indispensable."

US President Joe Biden (Joe Biden) this year hopes to advance the so-called infrastructure construction plan, which may provide tax incentives for companies that bring jobs back to the United States or expand manufacturing operations in the United States. When participating in the presidential campaign, Biden called for a 10% increase in taxes on US companies that transfer business overseas, and a 10% "Made in America" tax credit for companies that create jobs in the United States.

Jay Timmons, chairman and chief executive officer of the National Association of Manufacturers, said at a hearing on Tuesday: "The tax law needs stability and certainty, and we want to ensure that research expenses are still deductible. We think it needs to be Broad-based investment tax credit policy."

Jonathan Jennings, Ford's vice president of global commodity procurement and supplier technical assistance, said Congress should maintain a corporate tax rate of 21%. But the Biden administration is considering raising the tax rate to 28% to offset the cost of advancing the infrastructure construction plan.

Jennings also said that Congress needs to seek legislation to prevent changes in the "R&D credit" policy. Starting in 2022, this change will make tax credits for research costs even smaller and require companies to amortize costs over several years, rather than allowing them to offset expenses in the year they are spent. The bipartisan legislation proposed this week will double the value of certain companies’ R&D credits and allow companies to deduct this part of the cost immediately. (Little)

Source: NetEase Technology Report, translated by Google Translate