The CHIPS Act established a 25% advanced manufacturing investment tax credit, to be implemented by the U.S. Department of Treasury and set forth in section 48D of the Internal Revenue Code. Coupled with the CHIPS grants, these incentives will lower the cost gap between investing in the U.S. and investing abroad, while generating greater benefits to the U.S. economy, national security, supply chain, and technology leadership. SIA supports the extension of this credit.
The semiconductor industry is R&D intensive, with U.S. chip companies investing on average 20% of revenue back into R&D, the second highest investment by any sector. As technology advances and design costs rise, SIA supports a 25% investment tax credit for semiconductor design would ensure a holistic, integrated strategy to attract investment and provide predictable incentives to uphold U.S. leadership in chip design.
In 2017, SIA supported the Tax Cuts and Jobs Act, which included a number of important provisions, including changes to the treatment of foreign income derived from intellectual property such as patents. These reforms significantly improved the competitiveness of U.S. semiconductor research, design and manufacturing, and SIA supports the extension of such provisions.
