HOUSE APPROVES PERMANENT EXTENSION OF R&D TAX CREDIT

The U.S. House voted 274-131 to permanently extend the research and development tax credit with Republicans hailing the vote as a way to fix a tiny part of the tax code. The bill if it becomes law could save taxpayers an estimated $156 billion over the next 10 years. Christina Crooks, director of tax policy for the National Association of Manufacturers, said that many businesses and industries that supported the bill can claim the credit for its May 9 passage.

A statement from the National Association of Manufacturers said, "Today's House passage of a stronger, permanent R&D tax credit is an important step forward in increasing investment in the United States to create high-wage jobs."

NAM Senior Vice President of Policy and Government Relations, Aric Newhouse, commented about the American Research and Competitiveness Act of 2014: "Manufacturers have been longtime supporters of the R&D tax credit because they know it is critical to long-term growth and job creation," Newhouse said. "Right now, the United States ranks 22nd in research incentives among industrialized countries. If we want to continue to compete in the global economy and ensure our mantle of economic leadership, this must change."

The U.S. Senate proposes to continue federal highway funding at its current level through 2020 while allowing states and local governments more discretion in how they spend the money.

The Senate Environment and Public Works Committee on Thursday unanimously approved a bill to spend $265 billion on transportation projects over six years. This bill reauthorizes the federal gas tax, which collects $34 billion a year. That would provide $204 billion over the next six years, which is not enough to pay for the projects.

The bill is thought to reassure state and local transportation officials who fear a delay, reduction, and even disappearance of federal transportation funding in the summer. But because the highway trust fund may run out of money in August, Washington is talking about a gas tax increase.

"Manufacturers can't afford more delays," said Jay Timmons, president of the National Association of Manufacturers. "Congress must bring the federal Highway Trust Fund to an improved condition of solvency."

There are now three transportation spending plans under discussion, the Washington Post reported. The Boxer-Vitter version could be the one that makes it rather than bills from the House and the Obama administration. The bill draws attention to national transportation that may need $3.6 trillion by 2020.

"The nature of the projects and programs that state departments of transportation oversee require a long-term view in order to ensure the best investment of federal, state and local tax dollars," said Bud Wright of the American Association of State Highway and Transportation Officials.

Thursday action by the Federal Communications Commission could lead to Internet Service Providers charging Web sites for superior content delivery to users. But the proposed rule would prohibit providers from blocking or slowing Web sites.

The commission 3-2 approved notice of a proposed rule that asks what is the right public policy to ensure that the Internet remains open to all?

Sequestration fears pushed by White House were erroneous

The Hill (Wasson 5/7) "A new government report has found that last year's sequester led to only one federal layoff, a conclusion that Sen. Tom Coburn (R-Okla.) said Wednesday was an outrage. Coburn said the finding from the Government Accountability Office (GAO) is more proof that the Obama administration and its allies overhyped the effects of the automatic budget cuts, and in a letter to Obama budget director Sylvia Burwell, he demanded an official report on the government's sequestration response.

"'The Budget Control Act is the law of the land until Fiscal Year 2021, so it is essential to have a complete understanding of how agencies manage their workforces and operations in this constrained fiscal environment', Coburn wrote.

"Buried in a GAO report from March is a finding that in all of the federal government, the Justice Department alone laid off one staff member as a result of the $80.5 billion in automatic spending cuts implemented in 2013 as a result of the sequester. The Obama administration and Democrats last year claimed that sequestration would be devastating to the government and to the wider economy. Republicans have repeatedly questioned those claims, calling them scare tactics.

"Coburn said the one layoff reported by the GAO is a stark contrast with estimates from both the Congressional Budget Office and Goldman Sachs that suggested it would lead to far more job losses. 'The facts seem to say the experts overestimated sequestration's impact by between 99,999 and 1,599,999 jobs, according to two frequently-cited estimates by Goldman Sachs and the Congressional Budget Office', Coburn said."

GOP blocks tax cut bill over principle

POLITICO (Everett, Faler 5/15) "Senate Republicans on Thursday blocked an $84 billion tax cut bill as a fight over amendments claimed its second victim in less than a week. The legislation, which would revive a raft of expired tax breaks, failed to clear a procedural hurdle amid widespread objections from Republicans that they had not been allowed to offer amendments, including one targeting an Obamacare medical device tax. The vote was 53-40, with 60 needed to advance the measure.

"The dispute comes just days after a similar impasse scuttled an energy efficiency bill and a vote on the Keystone Pipeline - presaging six more months of gridlock and partisan bickering if Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell cannot forge a working relationship before the November election. Lawmakers said they did not know what will happen next with the so-called tax extenders, which would renew a hodgepodge of temporary provisions benefiting teachers, commuters, banks and others that are usually rolled over by Congress with minimal drama.

Groups urge Congress to save jobs by rejecting PBGC premium increases

National Association of Manufacturers (Lavoie, Godbout, Holmes 5/14) "A National Association of Manufacturers (5/15) press release announces the Tuesday release of a Pension Coalition study 'revealing the significant economic impact and job loss that would accompany the proposed billions of dollars in increases to Pension Benefit Guaranty Corporation (PBGC) premiums'. Calling the new premiums 'essentially a tax hike,' and with manufacturers 'reeling' from increases over the last two years, NAM says that 'adding billions more in unnecessary costs will put an anchor on economic growth'.

The study finds that the new increases will result in a loss of $51.4 million to the US economy over 11 years, cost an average of 42,000 jobs per year, and that Congress could save 24,500 jobs per year by rejecting additional premium hikes. Reactions to the report voiced the frustrations manufacturers feel with the newly proposed premiums. Owens-Illinois Director of Compensation and Benefits Etta Strong said, 'It's simple: The more money we are forced to spend on PBGC premiums, the less money we have to spend on something else'." Quad/Graphics Director of Government Affairs Patrick Henderson commented, 'Congress ought to understand that these premiums are a tax, and the money raised should reflect the true risk and not be used for other spending priorities'.