Op-ed: Revive federal tax credit program | News, Sports, Jobs

Written by on July 29, 2022

Op-ed: Revive federal tax credit program | News, Sports, Jobs

Op-ed: Revive federal tax credit program | News, Sports, Jobs


In 2017, the United States finally made the federal corporate tax rate competitive with the rest of the world when it was dropped from a punishing 35% down to 21%. But this only represents the tax burden that the United States federal government charges before state corporate tax rates are added. West Virginia charges 6.5% in addition to the 21% federal rate on the companies doing business here.

Nations across Europe charge far less than the United States and there are efforts underway to set a global minimum corporate tax of 15% — far less than what American companies are paying. Therefore, we cannot allow the Biden Administration to raise taxes on American job creators to 28% as the global economy becomes less and less certain.

There are other more proactive steps that Congress can take to improve the tax competitiveness of American manufacturers. To compete with other nations, Congress must pass legislation enshrining and expanding advanced clean manufacturing under 48C tax credits — and should do so without tying it to any proposal that would unnecessarily raise other taxes on manufacturers — including the horribly titled “Build Back Better” bill.

During the Great Recession, 48C tax credits were instituted to provide a credit of up to 30% for investments in building new manufacturing facilities or expanding existing facilities to produce clean energy technologies. The Recovery Act in 2009-10 offered $2.3 billion in tax credits that became so popular it was oversubscribed by more than three-fold. At a trying time in America’s economy, 48C helped manufacturers create new jobs and protect existing ones by enabling the companies to modernize and stay competitive

However, while the project was amazingly successful during that difficult time, there were areas that could be strongly improved through updating the program. Of the nearly 200 projects approved by the U.S. Department of Energy in 2009-10, West Virginia was left out of those awardees.

Senator Manchin should be applauded for his efforts to revitalize and expand 48C tax credits for former mine sites and power plants. By doing so, West Virginia would be able to market new economic development properties for advanced manufacturing and revitalize former energy communities. Some of the best properties in the state are found on former surface mine sites and shuttered power plants. Additionally, present surface mine sites that are scheduled to soon deplete their reserves would be able to strategically plan for a post-mine use for new economic development if tax credits like 48C were reinstituted.

West Virginia’s manufacturers could benefit significantly were Congress to reenact the 48C tax credit program. These manufacturers have continued to provide jobs and opportunities for the Mountain State year-after-year as their foreign competitors have been subsidized by their respective governments. Not only do manufacturers in our state deserve our admiration, but they too should receive our support in helping to create a tax and regulatory environment that they can thrive in for advanced, clean manufacturing.

For decades, manufacturing has left America as countries around the globe have found ways to lower their corporate taxes and offer incentives. Those nations have not always had the best reputations for clean manufacturing practices. We have an opportunity to bring more manufacturing back to America, support our supply chains and do so in ways that are far more friendly to the world’s environment.

Reinstituting the 48C tax credit, and expanding it to former mine lands and power plants, is not only the right thing to do for West Virginia manufacturing but for America as well.

***

Rebecca McPhail is executive director of the West Virginia Manufacturers Association.

Today’s breaking news and more in your inbox

— to www.newsandsentinel.com

The post Op-ed: Revive federal tax credit program | News, Sports, Jobs appeared first on Correct Success.


Reader's opinions

Leave a Reply


Current track

Title

Artist