The CEO Council for Growth is pleased to provide a federal legislative update on policy issues important to the region’s business community. Together with the Greater Philadelphia Chamber of Commerce, the CEO Council presents the unique opportunity to discuss the priorities below with Members of the region’s congressional delegation as well as Executive Branch officials in Washington, D.C. on Wednesday, September 17. We encourage business leaders to advocate on these issues and others by registering for the annual Chamber Day trip. Please click here for more information.
Federal Funding for Research
The CEO Council continues to actively advocate for increased research funding in the federal accounts responsible for dispersing research funds. Research in our region is leading to major breakthroughs in innovation, new technologies, life-saving medical treatments, and regional job growth. The federal government’s support and funding for research is key to advancing our economy and global competitiveness. Sequestration cuts enacted by Congress combined with discretionary spending caps well below the rate of inflation place severe limitations on the amount of funding available to sustain adequate research investments.
Delaware River Main Channel Deepening Project
The CEO Council was pleased to see an increased level of funding to $35 million for continued progress toward the completion of the Delaware River Main Channel Deepening Project in the President’s Budget Proposal. We will continue to work with our Congressional Delegation to ensure that Congress approves at least as much FY15 funding for dredging as was seen in the President’s proposal. Deepening the Delaware River shipping channel will allow our region to remain competitive in the global marketplace and assure the future economic health and vitality of the Delaware River maritime complex.
Research & Development
We continue to support the expansion and permanent extension of the Research & Development (R&D) tax credit to provide companies an assured and enhanced incentive to invest in innovation. A permanent R&D tax credit would foster job growth and instill long-term certainty for R&D enterprises, which are a critical part of our region. In addition, we support the Startup Innovation Credit Act authored by Senator Coons, which benefits young start-ups by allowing qualifying companies to offset employee tax liability. The tax credit would free up critical resources for new companies that have not yet created significant income tax liability to take advantage of the R&D tax credit.
Comprehensive Tax Reform
In the next Congress, we will work to bring reforms to our nation’s tax code that support research and development, foster entrepreneurship, and increase our region’s global competitiveness. Efforts to reform the tax code should promote simplicity and certainty, reduce fraud from unreported taxes, and help employers make long-term business decisions without fear of expiring tax provisions.
Responsible tax reform must include a competitive tax structure for both the individual and corporate income tax rates. Congress must advance a competitive individual income tax structure for employers that report the flow-through of income and losses on their personal tax returns and are assessed at the individual income tax rates. Restructuring the corporate tax rate – the highest corporate tax rate in the industrialized world – would encourage foreign companies to locate in the U.S. and incentivize investment in new hires, capital investments, and research and development by U.S. companies.
Comprehensive tax reform must include an international tax system that will help companies compete globally, grow domestically, and increase repatriated income. U.S. multinationals are taxed here on their domestic profits, taxed abroad on their foreign profits, and then taxed again when their foreign profits are brought back home. Under the current deferral system, U.S. firms have a big incentive to leave their foreign earnings offshore, where they can avoid U.S. taxes. Estimates value the total amount of cash and assets parked offshore at $2 trillion. Congress should adopt a tax system that will help American companies build global brands while continuing to strengthen operations back home. Eliminating all or most of the double-tax on repatriated income from foreign affiliates would remove a competitive disadvantage and encourage greater investment in our economy from foreign profits.
Since Congress recently provided a temporary patch to fund the Highway Trust Fund into May 2015, the CEO Council looks forward to working with the next Congress to pass a long-term surface transportation bill that includes funding levels, policies, and projects that will enhance the region’s current transportation assets and enable agencies and governments to plan for large-scale infrastructure projects.
As an active member of the Keystone Transportation Funding Coalition, the Chamber and CEO Council will continue to meet with federal lawmakers to identify new, long-term, sustainable transportation funding to address the forecasted shortfall of the Highway Trust Fund. We believe that elected leaders should explore existing and new user-related revenue sources that will bring solvency back to the Highway Trust Fund.
In addition, the CEO Council supports the establishment of alternative funding options such as tolling or public private partnerships through state or multi-state agencies to create measureable improvement or capacity expansion of existing highways and interstates. Additional revenue from tolling will help our region fund new construction projects and expand highway capacity. We believe that expanding the ability of state transportation agencies to toll existing federal aid highways is an important component of a long-term transportation infrastructure financing plan. Specifically, we believe that if toll lanes are added to a federal aid highway, then states should be able to toll all the lanes rather than just the lanes that will be constructed. The current requirement, which limits tolling to new lanes, is impractical and will not generate enough revenue to construct significant projects.
The CEO Council continues to call on Congress to adopt highly-skilled immigration reform. We support the highly-skilled provisions that were adopted by the Senate in S.744. Highly-educated workers help drive innovation, economic growth, and job creation, all of which are essential components for the region to remain competitive in the global economy.
The CEO Council urges Members of Congress to support the following reforms:
- Establish a market-based H-1B cap and increase the employment-based green card cap;
- Exempt STEM graduates from U.S. universities from the annual employment-based visa cap if they have an offer of employment from a U.S. business in a related field;
- Streamline and improve visa and green card application process;
- Eliminate the employment-based per-country visa cap;
- Use new company-paid visa and green card fees to help fund STEM programs in U.S. schools to train the next generation American workforce; and
- Provide visas and green cards to startup entrepreneurs and advance science, technology, engineering and math (STEM) degree holders from U.S. universities.
Collectively, these policies will stimulate entrepreneurship and help employers in the Greater Philadelphia area grow and remain competitive.