House Passes R&D Tax Credit Bill

The House of Representatives passed a $116 billion bill that includes a one-year retroactive renewal of the R&D tax credit and other individual and business tax incentives that expired at the end of last year. The cost of the American Jobs & Closing Tax Loopholes Act of 2010 (H.R. 4213), which passed on May 28, is partially offset by $56 billion in revenue-raising provisions. The revenue offsets include tax increases affecting small businesses and multinational corporations, which have led a number of business groups to express concern with the measure. Many small and midsized chemical manufacturers rely on the R&D tax credit to fuel their ability to produce new technologies, says William E. Allmond IV, vice president of government relations at the Society of Chemical Manufacturers & Affiliates, an industry trade association. SOCMA steadfastly supports the R&D incentive, Allmond notes, but including “controversial new taxes to offset the tax benefit complicates our support” for the legislation. The bill now goes to the Senate, which already has announced it will consider amendments to H.R. 4213 after the Memorial Day recess.