Federal legislation would invest in semiconductor chips

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Bipartisan legislation recently introduced in the US House of Representatives would create long-term investment in the design and manufacture of semiconductor chips in the United States.

The Facilitating American-Built Semiconductors Act would grant semiconductor companies a 25% refundable investment tax credit (RITC) to invest in manufacturing. The credit could be used to cover the costs of purchasing semiconductor manufacturing equipment that would produce the chips or building a semiconductor manufacturing plant.

The bill would also provide a 25% RITC to companies investing in semiconductor research and design.

“Building semiconductor chips here in America strengthens the U.S. supply chain, reduces our dependence on foreign products, and creates more jobs here at home,” said U.S. Representative Mike Kelly (R -PA), co-chair of the House Auto Caucus. “The auto industry – heavily reliant on semiconductor chips – has been the heart and soul of America for more than a century. This growth-friendly legislation is a win-win and will help ensure it can continue for the next century.”

Semiconductor chips are used in many electronic devices, including smartphones, vehicles, advanced weapon systems and other technologies. Most of the semiconductors used in the United States are made in foreign countries.

China offers incentives to attract semiconductor companies.

About Michael S. Montanez

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