Arlington, VA, Sept. 24, 2004 - The Information Technology Association of America (ITAA) today praised Congress for extending a tax credit designed to encourage companies to conduct research and development activity in the United States.
Both the Senate and the House of Representatives yesterday voted to pass a seamless, 18-month extension of the research and development tax credit as part of a package of tax cuts. The Middle Class Tax Extenders bill, HR 1308, passed the Senate and House by votes of 92-3 and 339-65 respectively.
While ITAA continues to support a permanent extension, as well as several improvements dropped from the Senate version of the legislation in conference, the Association hailed the vote as a positive for American industry in a competitive global economy.
"America's ability to compete in the global marketplace will be determined by many factors, not the least of which is sustained research and development in high technology fields," said ITAA President Harris N. Miller. "This extension provides companies with the certainty they need to push the technology envelope while containing financial risk."
Prior to the conference committee, both houses had passed differing bills extending the credit. ITAA had supported full passage of the Senate bill, which would have made it easier for companies to qualify for the tax credit. In addition to measures dropped from the Senate bill, ITAA continues to support a permanent tax credit.
"Eighteen months is not a very long time. ITAA urges Congress to address this issue for good at its next opportunity and extend this tax credit permanently," Miller added. "A permanent research and development tax credit would put to rest the periodic uncertainty injected into board rooms around the country each time Congress lets the credit lapse."
Congress allowed the credit to expire June 30, adding uncertainty to a hesitant economic recovery. Extended 10 times since 1981, the credit allows U.S. companies to get a tax credit of up to 10 percent of R&D spending.
The Information Technology Association of America (ITAA) provides global public policy, business networking, and national leadership to promote the continued rapid growth of the IT industry. ITAA consists of over 350 corporate members throughout the U.S. The Association plays the leading role in issues of IT industry concern including information security, taxes and finance policy, digital intellectual property protection, telecommunications competition, workforce and education, immigration, online privacy and consumer protection, government IT procurement, human resources and e-commerce policy. ITAA members range from the smallest IT start-ups to industry leaders in the Internet, software, IT services, ASP, digital content, systems integration, telecommunications, and enterprise solution fields. For more information visit www.itaa.org. ITAA is secretariat of the World Information Technology and Services Alliance, consisting of 60 IT trade associations around the world.