Innovation is a key driver of economic growth, job creation, and American strength. America has long been the leader in innovation, but we need a more dynamic tax code to cement the U.S. as the innovation superpower.
The Status Quo
Though America has long dominated in the realm of innovation, other nations are catching up. Meanwhile, startup creation in the U.S. is at a nearly 40-year low. When new companies are founded, they have a tough time competing with their larger competitors for employees because of laws that limit employee ownership of companies. This is bad for employers and employees alike.
Here’s how this reform will put Americans and their ideas on top in the 21st century economy:
· Ensure the 20% research and development (R&D) tax credit is permanent so companies can turn new ideas into reality.
· Make it easier for employees to own a piece of the company they work for by deferring the tax on the gains they make from their company stock.
This second point in particular helps workers who all too often walk away from being partial owners. Many of these workers can’t afford the immediate tax bill on gains that hits them at a time when they can’t yet legally sell some of the stock to cover the costs.
Why We’re Doing This
House Republicans know that Americans are the kind of people who break the mold and always figure out a way to succeed. Keeping a permanent R&D tax credit and incentivizing more employee-ownership puts America in the best position to innovate and lead in the 21st century.
Learn more at fairandsimple.gop, or click the links below to see how our bill helps: