Arlington, Va. (April 15, 2024) – Aerospace Industries Association (AIA) President and CEO Eric Fanning has called on the Senate to pass the Tax Relief for American Families and Workers Act, emphasizing the need to reform the research and development tax expensing provision. Fanning highlighted the detrimental impact of the current policy on American innovation and competitiveness.
Speaking on the urgency of the matter, Fanning stated, "American innovation has always led the way, from airplanes to moon landings. But the 2022 research and development (R&D) expensing change is holding us back." He expressed concern that the United States is now among the select few countries that do not allow full deductions for R&D expenses, leading to adverse effects on the economy and global competitiveness.
Fanning pointed out that the lack of adequate R&D tax expensing is forcing employers to make workforce reductions and undermining the incentives for innovation. Drawing a comparison with other nations, he noted, "Unlike us, nearly every other country, including China, is investing even more in R&D."
Emphasizing the bipartisan support for the proposed reform, Fanning urged the Senate to take decisive action by voting on the Tax Relief for American Families and Workers Act. He stressed, "Fixing this policy is common sense and already has bipartisan support. It’s time for the Senate to vote on the Tax Relief for American Families and Workers Act to put American innovation back in first place."
The Aerospace Industries Association and its members have consistently advocated for addressing this issue. Fanning commended the House for passing the bill earlier this year and urged the Senate to follow suit. Additionally, the AIA released an updated R&D fact sheet, reinforcing the importance of a pro-growth tax code in fostering innovation and economic growth.
As the nation marks another Tax Day, the call for R&D tax expensing reform resonates strongly within the industry and among policymakers. The future of American innovation and competitiveness hinges on the Senate's decision regarding the proposed legislation.
