October 11, 2022
The Honorable Chuck Schumer
Washington, DC 20510
The Honorable Mitch McConnell
Washington, DC 20510
The Honorable Nancy Pelosi
U.S. House of Representatives
Washington, DC 20515
The Honorable Kevin McCarthy
U.S. House of Representatives
Washington, DC 20515
Dear Majority Leader Schumer, Minority Leader McConnell, Speaker Pelosi and Minority Leader McCarthy,
We, the undersigned businesses and trade associations collectively employing millions of Americans, write to urge Congress to take immediate action to reverse a harmful tax change that threatens jobs and innovation in America.
Innovation is one of America’s greatest strengths and a significant contributor to job and economic growth, competitiveness and national security. It is for these reasons that for nearly 70 years the tax code has recognized the importance of research and development by allowing businesses to fully deduct their R&D expenses in the same year. However, beginning this year, businesses must amortize or deduct these expenses over a period of years, making R&D more costly to conduct in the U.S.
Failing to reverse this change will cost well-paying jobs and reduce future innovation-directed R&D. Requiring the amortization of research expenses will reduce R&D spending and lead to a loss of more than 20,000 R&D jobs in the first five years with the number of lost jobs rising to nearly 60,000 over the following five years. Moreover, when accounting for the spillover effect from R&D spending, nearly three times as many jobs will be affected.1 This same study also found that for every $1 billion in R&D spending, 17,000 jobs are supported in the U.S.
As a result of this change, the U.S. is now one of two developed countries requiring the amortization of R&D expenses. Meanwhile, China currently provides a super deduction for R&D expenses up to an extra 100% of eligible R&D expenses in addition to actual R&D expenses. At a time of increasingly fierce global competition for research dollars, this change will make it harder for the next R&D dollar to be spent in the U.S. which will ultimately hurt future U.S. competitiveness.
The amortization requirement also poses a serious threat to our national security if not reversed. As the National Science and Technology Council has noted, R&D investments “are essential to
1 See EY, Impact of the Amortization of Certain R&D Expenditures on R&D Spending in the U.S. at i (2019), https://investinamericasfuture.org/ey-impact-of-the-amortization-of-certain-rd-expenditures-on-rd-spending-in-the-united-states/.
ensure that the United States remains able to secure and protect the American people in the face” of other countries increasing support for R&D.2
For these reasons, we respectfully urge Congress to act without delay to ensure that the tax code continues to support innovation as doing so will help secure America’s global leadership in innovation and its economic and national security future.
A Raymond Corporate North America Inc
Raymond Corporate NA
Abicor Binzel USA, INC.
Advance Engineering Company
Aerospace Industries Association
AICC, The Independent Packaging Association
Air-Conditioning, Heating & Refrigeration Institute
Albert Basse Associates, Inc.
Alliance for Automotive Innovation
Alliance for Competitive Taxation
Allied Systems Company
American Automotive Policy Council (AAPC)
American Bakers Association
American Chemistry Council
American Cleaning Institute
American Colors, Inc.
American Composites Manufacturers Association
American Council of Engineering Companies
American Forest & Paper Association
American Foundry Society
American Frozen Food Institute
American Mold Builders Association
American Welding Society
American Woodmark Corporation
Ames Chamber of Commerce
Amkor Technology, Inc
AMT- The Association For Manufacturing Technology
Analog Devices, Inc.
AnyLogic North America, LLC
Applied Materials, Inc.
AR State Chamber/AIA ARC-Tronics Inc.
Arizona Builders Alliance
Arizona Chamber of Commerce & Industry
Arizona Manufacturers Council
Asheville Area Chamber of Commerce (NC)
Associated Industries of Florida
Associated Industries of Missouri
Associated Industries of Vermont
Association for Uncrewed Vehicle Systems International
Association of Washington Business
Astera Labs, Inc.
Automated Pet Care Products, LLC (dba Whisker)
Autos Drive America
AVL North America
BC Partners, LLC
Biotechnology Innovation Organization
B-K Tool & Design, Inc.
Black Buffalo, Inc.
Bluewater Technologies Group, Inc.
Boulder Scientific Company, LLC
Brick Industry Association
Bristol TN/VA Chamber of Commerce
Business & Industry Association of New Hampshire
Business Council of Alabama
The Business Council of New York State, Inc.
Cadillac Casting, Inc.
California Manufacturers & Technology Association
Cambria Regional Chamber (PA)
Can Manufacturers Institute
Capital Area Manufacturing Council (MI)
Cardinal Glass Industries
The Carpet and Rug Institute
Cascade Die Casting Group, Inc.
Cast Aluminum Solutions
Cedar Rapids Metro Economic Alliance (IA)
Cellulose Insulation Manufacturers Association
Certis Oncology Solutions, Inc
Chamber of Commerce Hawaii
Charles River Laboratories International, Inc.
Coastal Automotive (MI)
Cognizant Technology Solutions
Colorado Advanced Manufacturing Association
Colorado Chamber of Commerce
Compass Mortgage, Inc.
Composite Panel Association
Composites International, Inc.
Computing Technology Industry Association
Connecticut Business & Industry Association
Contemporary Control Systems, Inc.
Core Health & Fitness, LLC
Council Bluffs Area Chamber of Commerce (IA)
Council of Industry of Southeastern New York (NY)
Cybernet Systems Corporation
Dearborn Holding Company, LLC
Delaware Manufacturing Association
DENSO International America, Inc.
Detroit Manufacturing Systems
ECIA - Electronic Components Industry Association
Edgewater Automation, LLC
Edward Segal Inc.
EFK Moen, LLC
Energy Workforce & Technology Council (TX)
ENGLAND, THIMS & MILLER, INC.
F&S Tool, Inc.
Falcon Plastics Inc.
Federal Equipment Company
The Fynder Group, Inc.
Financial Executives International (FEI)
First Line Technology, LLC
Forging Industry Association
Fragrance Creators Association
Garden State Precast, Inc
GE Appliances, a Haier company
Genentech, A Member of the Roche Group
General Aviation Manufacturers Association (GAMA)
General Plastics & Composites, LP
Glier's Meats, Inc.
Global Business Alliance
Gowan Milling Company LLC
Grand Rapids Foam Technologies
Greater Durham Chamber of Commerce (NC)
Greater North Dakota Chamber
Greater Omaha Chamber (NE)
Greater Pittsburgh Chamber of Commerce (PA)
Greater Yakima Chamber of Commerce (WA)
Griffin Tool, Inc.
Halff Associates, Inc.
Helicopter Association International (HAI)
Helms Performance Group
Hendrickson USA LLC
Hornady Mfg. Co.
Huntington Ingalls Industries
Idaho Association of Commerce and Industry
Illinois Manufacturers’ Association
ImageMark Business Services, Inc.
IMS Companies, LLC
INDA - Association for the Nonwoven Fabrics Industry
Independent Can Company
Indiana Manufacturers Association
Induron Coatings, LLC
Industrial Control Repair Inc.
Information Technology Industry Council
International Mold Corporation
International Sleep Products Assn
Ionis Pharmaceuticals, Inc.
Iowa Association of Business and Industry
Jamison Door Company
JOST International Corporation
Kansas Chamber and the Kansas Manufacturing Council
Keats Manufacturing Co.
Kentucky Association of Manufacturers
The Kraft Heinz Company
Kreative Technologies, LLC
Kyocera AVX Components Corporation
Lacks Enterprises, Inc
LAL Acquisition, Inc.
Leggett & Platt, Inc.
Lockheed Martin Corporation
Louisiana Pacific Building Solutions
LSV Asset Management
Lucerne International Inc,
M4 Factory, Inc,
MAC VALVES, INC.
MAHLE Industries, Incorporated
Maine State Chamber of Commerce
Manufacturing Alliance of Philadelphia (PA)
Marshall Area Chamber of Commerce (MN)
Martin Yale Industries, LLC
Maryland Chamber of Commerce
Merritt Aluminum Products Company
Merritt Trailers Inc.
Metal Powder Industries Federation
Metals Service Center Institute
Metalsa Structural Products, Inc.
Metro Atlanta Chamber (GA)
Michelin North America, Inc.
Michigan Manufacturers Association
Michigan Polymer Reclaim, Inc.
Microchip Technology Incorporated
Micron Technology, Inc.
Miles Fiberglass & Composites Inc
Miniature Custom Mfg., LLC
Minnesota Chamber of Commerce
Mississippi Manufacturers Association
Montana Chamber of Commerce
Morrison Products, Inc.
Motor & Equipment Manufacturers Association (MEMA)
National Association of Chemical Distributors (NACD)
National Association of Manufacturers (NAM)
National Bulk Equipment, Inc.
National Business Aviation Association
National Defense Industrial Association (NDIA)
National Electrical Manufacturers Association
National Marine Manufacturers Association
National Tooling and Machining Association
National Wooden Pallet & Container Association
Natural Alternatives International, Inc.
North Carolina Chamber
NCTA - The Internet & Television Association
Nebraska Chamber of Commerce & Industry
Nelson Irrigation Corporation
Nevada Manufacturers Association
New Balance Athletics
New Holland Brewing Company LLC
New Jersey Business & Industry Association
New Mexico Business Coalition
NewHold Enterprises LLC
NextPhase Medical Devices LLC
Non-Ferrous Founders' Society
North American Association of Food Equipment Manufacturers (NAFEM)
North American Die Casting Association
North Carolina Manufacturers Alliance (NCMA)
Northeast Pennsylvania Manufacturers & Employers Association
Northrop Grumman Corporation
Oakwood Metal Fabricating Co
The Oakwood Group
The Ohio Manufacturers' Association
O'Neal Industries, Inc.
Oregon Business & Industry
Panasonic Corporation of North America
PBS Engineering and Environmental Inc.
Pennsylvania Chamber of Business & Industry
Pennsylvania Manufacturers' Association
PFI Holdco LLC
Pioneer Service Inc
Piston Group LLC
Plante & Moran, PLLC
Plastic Plate, LLC
Plastics Industry Association Plumbing Manufacturers International
PMA Technologies LLC
PMMI The Association for Packaging and Processing Technologies
Precast/Prestressed Concrete Institute
Precision Machined Products Association
Precision Metalforming Association
Pridgeon & Clay, Inc.
Printing United Alliance
Professional Services Council (PSC)
Quanergy Systems, Inc. Quasonix, Inc.
R L Industries Inc.
Rare Disease Company Coalition
Regal Rexnord Corporation
Request Foods Inc
Rhode Island Manufacturers Association
RL Industries, Inc.
Roanoke Regional Chamber of Commerce (VA)
Robert Bosch LLC
Rockwell Automation Inc.
Rolls-Royce North America
Rosti North America (FKA: Plastic Components, Inc.)
RTM ENGINEERING CONSULTANTS
Rubadue Wire Co., Inc.
Schaeffler Group USA
Schuylkill Chamber of Commerce
Semiconductor Industry Association
Sequoia Automatic, Inc.
Silicon Valley Tax Directors Group
Simmons Knife & Saw
Skilled Manufacturing, Inc
Society of Chemical Manufacturers & Affiliates
Somerset County Chamber of Commerce (PA)
South Carolina Chamber of Commerce
Span Tech LLC
Specialty Tooling Systems
Star Iron Works, Inc.
Star Plastics, LLC
The State Chamber of Oklahoma
Steel Manufacturers Association
T. Baker Smith, LLC
Tata Technologies Inc.
Technoform Glass Insulation NA Inc
Tennessee Chamber and Manufacturers Association
Texas Association of Business
Texas Association of Manufacturers
Texas Instruments Incorporated
Textile Care Allied Trades Association
Thomas & Hutton Engineering Co.
The Timken Company
Tooling Systems Group, Inc.
Trabon Printing Company, Inc.
Trademark Die & Engineering Inc.
Treated Wood Council
Triangle Package Machinery Company
Truck Trailer Manufacturers Association, Inc.
U.S. Chamber of Commerce
Umicore USA Inc
United Therapeutics Corp.
Utah Manufacturers Association
V3 Companies, Ltd.
Valley Industrial Association
Walker Tool & Die, Inc.
Water and Wastewater Equipment Manufacturers Association
Wells Printing Co., Inc
West Virginia Manufacturers Association
Westmoreland County Chamber of Commerce (PA)
The Willamette Valley Company LLC
Whisman Giordano & Associates, LLC
Window & Door Manufacturers Association
Wisconsin Manufacturers & Commerce
ZF North America, Inc.
The Honorable Ron Wyden
The Honorable Mike Crapo
The Honorable Richard Neal
The Honorable Kevin Brady