Writing last week for Morning Consult, BIO President and CEO Jim Greenwood proposed several policy ideas for Washington lawmakers to consider as they look to further reform America’s tax code.
Our nation’s life sciences industry is thriving but other countries are adopting policies designed to attract biotechnology firms to their shores, and as a result, the U.S. is losing some of its competitive advantage. In fact, as shown in a recent report commissioned by the Information Technology and Innovation Foundation, American innovation has slowed in recent years as other countries have developed policies to encourage innovation abroad.
“Foreign nations are competing aggressively to attract more life sciences investment, including through tax incentives such as “patent boxes” (which tax patent revenues more favorably than other sources of commercial revenue), regulatory reforms to speed up drug approvals, and workforce and immigration policies designed to attract and educate top talent in the life sciences field,” Greenwood warns.
Luckily, the ball is in our court. With Congress signaling that another round of changes to the tax code is in the works, adopting relatively simple changes can help cement U.S. leadership in the biosciences for generations to come. Here’s a sample of what BIO recommends:
- Reforming Section 382 of the tax code to help small biotechs further invest in the growth of their companies;
- Simplifying Section 1202 of the tax code to encourage investment in innovative breakthroughs; and
- Enabling more innovative startups to benefit from the payroll R&D credit in Section 41 of the Tax Code.