Senate proposes 25% tax credit for semiconductor manufacturing
Biden to sign executive order to review semiconductor chip supply chain
Jen Psaki on semiconductor chip supply chain
A bipartisan group of U.S. senators on Thursday proposed a 25% tax credit for investments in semiconductor manufacturing as Congress works to increase U.S. chip production.
The proposal sponsored by Senate Finance Committee Chairman Ron Wyden and the top Republican on the panel, Senator Mike Crapo, along with Senators Mark Warner, Debbie Stabenow, John Cornyn and Steve Daines, would provide "reasonable, targeted incentives for domestic semiconductor manufacturing," they said in a statement.
The group did not immediately provide a cost estimate for the measure, which is on top of recent proposed semiconductor funding. Last week, the Senate approved $52 billion for production and research on semiconductors and telecommunications equipment. That included $2 billion dedicated to chips used by automakers, which have seen massive shortages and made significant production cuts. The House of Representatives must still act on the measure.
US CHIP FUNDING COULD RESULT IN SEVEN TO 10 NEW FACTORIES
Supporters of funding note the U.S. share of semiconductors and microelectronics production has fallen to 12% from 37% in 1990.
The senators said up to 70% of the cost difference for producing semiconductors overseas results from foreign subsidies.
"The United States can’t allow foreign governments to continue to lure companies’ manufacturing overseas, increasing risks to our economy and costing American workers good-paying jobs," Wyden said.