Strengthening the U.S. SemiconductorIndustrial Base - Semiconductor Industry Association

The U.S. is the undisputed global leader in semiconductors, the key foundational technology for everything digital that has transformed all sectors of our economy – including the internet, telecommunications, transportation, health care, and more. The U.S. semiconductor industry is a major engine for U.S. economic growth and job creation. Semiconductors underpin the “must-win” technologies of the future, including artificial intelligence, 5G, and quantum computing. Many of today’s leading chips for cutting-edge applications are currently designed by U.S. companies. Continued American leadership in semiconductors is essential to America’s national security. Without access to secure semiconductors, the U.S. will not be able to field advanced weapons systems or defend its critical infrastructure.

To keep America on top in semiconductors and ensure the enduring strength of our country’s economy and national security, we call on U.S. government leaders to invest ambitiously in the U.S. semiconductor manufacturing ecosystem and in semiconductor R&D.

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1. Manufacturing Grants and Tax Incentives Establish a new manufacturing grant program, tax incentives, and targeted security investments to spur construction of new onshore advanced semiconductor manufacturing facilities in the U.S., including leading-edge logic foundries, advanced memory, and analog fabs to supply defense, critical infrastructure, and broader essential commercial needs.

2. R&D Investments Increase investment in semiconductor research – both basic and applied R&D — at federal research agencies (DoD, DoE, NSF, and NIST), manufacturing institutes, and semiconductor companies to strengthen U.S. technology leadershipand build the pipeline of talent neededfor future innovation.

INCENTIVES TO ENCOURAGE ADVANCED SEMICONDUCTOR MANUFACTURING IN THE USA

INCREASE MANUFACTURING INCENTIVES
To strengthen our economy, enhance national security, and promote supply chain resilience, the U.S. needs to compete with other countries in attracting the construction and operation of new fabs by establishing grant and tax incentives, including the following:

A new federal grant program that would provide grants for incentivizing new domestic semiconductor manufacturing facilities (fabrication, assembly, test, and advanced development) that align with our nation’s strategic priorities. These federal grants would be in addition to state-level incentives.

Federal funding to develop an advanced logic foundry ecosystem to address U.S. national security concerns. This would include investments in secure design systems, assurance and security technologies, and funding for new commercial approaches to onshore fabrication for the U.S. national security community for both leading-edge logic (minimum 7nm EUV capable and below) and specialty process technologies.

Tax incentives for semiconductor manufacturing, such as a refundable investment tax credit for placing into service new semiconductor manufacturing equipment, as well as fab infrastructure and capital costs.

THE U.S. NEEDS TO INCREASE INVESTMENTS IN SEMICONDUCTOR RESEARCH

INCREASED R&D INVESTMENTS

The U.S. needs to significantly increase federal investments in semiconductor design and manufacturing research within the next decade, including the following:

U.S. federal investments in basic semiconductor research at federal research agencies (DoD, DoE, NSF and NIST) to enable fundamental technology breakthroughs necessary to maintain and look beyond Moore’s Law and train the scientists and engineers needed to drive future innovations.
Grants for federal applied semiconductor R&D through programs such as the DARPA Electronics Resurgence Initiative to enable U.S. companies to maintain their technological edge and strengthen supply chain security in semiconductor materials, process technology, architectures, designs, and applications.
Federal funding to help establish a public-private consortium to build and operate a National Semiconductor Technology Center to serve as a hub for conducting advanced semiconductor research and prototyping that strengthens the domestic ecosystem. The Center would bring together industry, government, national labs, and academia around a common roadmap to drive innovations in semiconductors and develop the semiconductor workforce.

CALL TO ACTION

As Congress and the Administration consider policies to advance semiconductor design and manufacturing development in the U.S., significant incentives for fab construction and research in the U.S. are needed to ensure the next generation of semiconductor innovation will be developed in the U.S. These policies will require significant expenditures, but the cost of failing to do so would be far greater. The U.S. must compete to retain its leadership position in this vital technology to ensure our economic strength, national security, and supply chain resilience.