ITAA to Congress: Pass tax credit before adjourning

The Information Technology Association of America is calling on Congress to pass a strengthened research and development tax credit before the current lame-duck legislative session ends and lawmakers break for the holidays.ITAA says passage of such a tax credit now is a credibility issue for Congress and a jobs issue for America.“We implore Congress to pass a strengthened [R&D] credit before adjourning the 109th Congress,” said ITAA President and Chief Executive Officer Phil Bond. “This must not wait until January,” he added.The Democratic-led 110th Congress will convene early in January 2007.Congress allowed the credit to lapse last December and adjourned for the midterm elections Nov. 7 without passing the credit, despite the urging of industry and the Bush administration, ITAA said.“If companies cannot reliably plan their research and development on our shores, they will be forced to look elsewhere,” Bond said in a statement.“For more than 11 months, technology firms and other U.S. businesses have been unable to assume the credit in forecasting project costs or reporting financial results,” ITAA said. “Costs have increased for both future R&D projects and activities already under way, leaving executives to decide if some [R&D] should be delayed or conducted abroad.”Passage would help thousands of IT companies and other industries increase domestic investments and research by providing a tax break on R&D spending. Many technology companies factor this tax credit into their plans to conduct R&D in the United States, ITAA said.Bond called the lame-duck session a chance for both parties to prove they can work together to keep America competitive. “The credit is critical to innovation, and innovation means jobs for America,” he said.