January 24, 2023
This Week in Massachusetts – January 24, 2023
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Posted on August 6, 2014
Associated Industries of Massachusetts urged Governor Deval Patrick yesterday to sign an economic development bill that would expand the research-and-development tax credit and create multiple initiatives to accelerate job growth.
In a letter to the governor, AIM said that An Act Promoting Economic Growth across the Commonwealth contains provisions “that will have a positive impact on the Massachusetts business climate.”
The research-and-development tax provision creates an Alternative Simplified Credit (ASC) as an alternative to the traditional tax credit. ASC allows employers the option to claim a credit equal to 10 percent of any research expenses that exceed a base amount calculated over a period of three years.
Current law allows credits only for incremental R&D spending over a set base period in the 1980s.
AIM believes the changes are necessary to reverse a troubling 19.3 percent decline in R&D spending among Massachusetts employers between 2007 and 2011. The vast majority of research and development in Massachusetts takes place not in urban innovation districts, but in advanced manufacturing, defense and biopharma companies salted throughout the commonwealth
“And we know that R&D credits work. Massachusetts enacted a set of research and development tax incentives in 1991 that were among the most advantageous in the nation. Over the next five years, R&D spending in the commonwealth increased by more than 50 percent,” said John Regan, Executive Vice President of Government Affairs for AIM.
Other key provisions of the economic development bill include:
The Legislature passed the economic development bill in the early hours of August 1. Governor Patrick has the option to sign or veto the entire bill, veto individual sections of the bill, or send sections back to the Legislature with proposed amendments.