The adoption of territorial tax systems by other countries has placed U.S.-based companies at a significant tax disadvantage, making them less competitive globally. TechNet supports corporate tax reform efforts that address the rapidly growing disparity in tax treatment between the United States and its trading partners. These reforms should include:
- Lowering the corporate tax rate so that it is competitive with the rest of the industrialized world.
- Defending the legal right of U.S. corporations to structure global business operations consistent with relevant legal requirements.
- Adopting a competitive, market-based territorial tax system with balanced safeguards against base erosion and profit shifting that does not discriminate against any particular income, including income from intangible property.
- Allowing U.S.-based companies to repatriate their current overseas cash at a reduced rate.
- Preserving and enhancing the R&D tax credit.
- Developing an “Innovation Box” that encourages research and development, job creation, and services in the United States.
As Congress debates tax reform, other priorities should include:
- The seamless extension of all existing business tax credits, deductions, and exemptions.
- The continued prohibition of federal Internet access taxes.
- Simplified tax requirements for mobile workers.
- Accelerated expensing.
- Full business expensing.
Investment Tax Credit
- TechNet supports the seamless extension and modification of Section 48 of the Investment Tax Credit (ITC).
- H.R. 1090, the Technologies for Energy Security Act, would extend the Section 48 credits that expired in 2016, enabling projects with long development cycles, including both large fuel cell power generation systems and distributed generation systems, to effectively access the credits.