American Research and Competitiveness Act of 2014
Floor Speech
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Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
Well, I would just say that the gentleman from Maryland is correct. He has voted six times to extend the research and development tax credit without paying for it, for a total of 14 years.
Look, I think it is time we are honest with the American people. If we are going to extend these policies again and again and again--in this case, 30 years--and not pay for it, look, we shouldn't have to raise taxes to keep taxes the same.
So, again, I would urge my colleagues to support this legislation, and I reserve the balance of my time.
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Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, the research and development tax credit has been extended repeatedly by members of the other side and members of this side for nearly 30 years, and it has not been paid for in those extensions.
But what does that really mean? Well, what we have done in America, which no other country has done, is we have taken a valuable tax policy like that, something that should be certain and dependable, and made it temporary. Not only do we make it temporary, we allow it to expire for a year at a time. So over this 30-year period, employers, innovators, businesses, and companies have not known whether they can count on this policy in order to do something really important.
I heard Mr. Brady talk about the medical innovation and how critical that is to making peoples' lives better. I think of Big Rapids, Michigan, and Wolverine Worldwide, which makes military footwear and boots. They are constantly innovating that so that our military servicemen and -women have the best possible equipment on their feet. You can imagine the kinds of climates that we find our military in and how important this is.
But if companies like that don't know whether this tax policy is dependable, yet we extend it 30 years backwards retroactively and forward for a year, then we allow it to expire for a year, it absolutely makes no sense. By allowing it to expire repeatedly, we have called into question whether this R&D credit is available at all.
I would just say by supporting permanent policies--the reason it is so important to make this permanent, we can actually promote certainty for American businesses, and we need to generate certainly greater economic growth. The reason we are seeing the worst recovery since the Depression, 0.1 percent economic growth, none of us should be satisfied with that, and I don't think any of us are. We can generate more growth by making these things permanent. So we need to wake up to the reality and start offering some concrete solutions that really strengthen the economy and help hardworking taxpayers.
Let me just say the nonpartisan Joint Committee on Taxation, which is our referee on these matters, says that if we make the credit permanent that actually more research and development will take place, the kind of innovation that really puts America at the forefront of job creation and an economy that is strong and vibrant, that up to 10 percent more research and development will occur. We certainly need more of that, because that is more jobs, more innovation, and higher wages.
Let me just say that the President of the United States voted to extend the research and development tax credit unpaid for when he was a Senator. He signed legislation twice to extend the research and development tax credit unpaid for. I think 30 years of uncertainty has actually been a detriment--a detriment to U.S. business employers and certainly their employees because the jobs they provide are so dependent on our being at the cutting edge.
Look, this is the 21st century. We can't live in the past as if these policies don't matter. This is a very competitive world, and most of our constituents understand the kind of competition that we face. We need to make this permanent. We need to do it now. Let's do something positive and good for America, something that we have repeatedly done. Let's be honest about it.
Since we are going to extend it at some point temporarily another 2 years, let's make this permanent. Let's make this certain. Let's make this something that our employers can depend on so they can create the kind of jobs that we haven't seen.
With that, I yield back the balance of my time. Vote ``yes'' on this legislation.
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Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, our current Tax Code is broken. It is hurting families and hurting our ability to create good-paying jobs in this country.
Last week we learned that the economy grew 0.1 percent in the first quarter of 2014. One-tenth of a percent of growth is unacceptable. Hardworking families and small businesses are struggling in this economy, wages are flat, and businesses are not growing.
Beyond having the dubious distinction of the highest corporate rate in the world, the United States is the only country that also allows important pieces of its Tax Code, like the research and development tax credit, to expire on a regular basis.
Businesses can't grow and invest when the Tax Code is riddled with instability and uncertainty. The research and development credit, the permanent extension we have before us today, has been part of the U.S. Tax Code since 1981. Renewed year after year, the credit has long been bipartisan and an effective way to incentivize U.S. companies to innovate, create new products, and invest in the United States.
The bill we have before us is a result of years of work that the Ways and Means Committee members have put into tax reform. By simplifying the credit, we eliminate the burden on businesses to do substantial amounts of recordkeeping, maintain countless receipts, and perform complex calculations.
Notably, the R&D credit has been historically bipartisan. In fact, just a few years ago, Congressman Levin, now ranking Democrat on Ways and Means, and I cosponsored the House bill to extend the research and development tax credit. Today the bill is led by Mr. Brady and Mr. Larson and has many other Republican and Democrat cosponsors.
Many on the other side of the aisle have commented about the fact that this job-creating provision is unpaid for. I would note that this provision, among other extenders, has historically not been paid for. All together, Ways and Means Democrats have cast 71 votes on this floor in favor of unpaid extensions of this policy. That amounts to 15 years' worth of extensions.
While the change of tune may be for political reasons, I think we can all agree that this is the right policy. Making the R&D tax credit permanent is an important first step to achieving growth and putting us on a path toward comprehensive reform that lowers rates and makes the Code simpler and fairer. It also supports good-paying jobs. According to the National Association of Manufacturers, 70 percent of R&D credit dollars are used to pay salaries of R&D workers.
The United States was once the world leader in providing research incentives to U.S. companies so that U.S. companies could innovate and create new technologies and products, but we have fallen far behind. Other countries are moving past the United States, putting American companies at risk of falling further behind. Countries like Japan, the United Kingdom, Canada, Russia, and Slovenia have all invested more in research and development support than the United States.
This is unacceptable and we can do better. A strong permanent credit not only provides the certainty employers need, but the Joint Committee on Taxation estimates that making the R&D credit permanent will increase the amount of research and development American companies undertake by up to 10 percent. That translates into more workers, higher wages, and increased innovation here in the United States.
Mr. Speaker, I yield 1 minute to the gentleman from Virginia, Leader Cantor.
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Mr. CAMP. Mr. Speaker, I would just note for the record that the previous speaker, the gentleman from Maryland, has voted four times to extend the research and development tax credit, none of them paid for, for a total of 7 1/2 years.
With that, I yield 2 minutes to the gentleman from Texas (Mr. Brady), a distinguished member of the Ways and Means Committee and chairman of the Joint Economic Committee.
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Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
I would just say that the previous speaker, the gentleman from Wisconsin, has voted five times to extend the research and development tax credit--for 12 1/2 years--with not a nickel of it paid for, to use his words.
Let me just say that our friends in the Senate are advancing an ``unpaid-for'' extension of all of the extenders to the tune of $85 billion. I just think, to follow their line of logic, they would say we need to raise taxes to keep taxes the same. That makes no sense. We haven't done it for almost 30 years, and we shouldn't do it now.
I reserve the balance of my time.
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Mr. CAMP. Mr. Speaker, I would just say the gentleman from California voted three times to extend the R&D tax credit unoffset for a length of time of 8 years.
I continue to reserve the balance of my time.
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