SEMI urges renewal and extension of federal R&D tax credit

Washington, DC

SEMI has joined with more than 140 of its member companies in signing a joint industry Letter to Congress urging the renewal and permanent extension of the federal R&D tax credit that expired last month. The letter, sent to members of the U.S. House of Representatives and the Senate, emphasized the importance of the credit in stimulating long-term research and development in the U.S. “Many of the firms from our industry represented on the letter are small, extremely innovative companies that comprise the backbone of the U.S. electronics infrastructure,” says Stanley T. Myers, president of SEMI. “The costs of maintaining advanced R&D in the semiconductor and flat panel display industries now average 10 to 15 percent of annual sales and are accelerating. SEMI member companies are struggling to support these costs and remain competitive in the global market, where many other nations subsidize a larger portion of advanced R&D.”

The R&D credit was instituted by Congress in 1981. Last year, it was further refined to ensure that most high technology firms could take advantage of it. According to SEMI, to be effective, the credit needs to be extended further with no gaps in its coverage. SEMI has endorsed legislation that would meet this goal and is pressing for its inclusion in the upcoming Republican tax bill (H.R. 947, S.355 and S.405). — SES