Sweeping tax legislation passed by the US Senate on Tuesday would make it cheaper for semiconductor manufacturers to build plants in the US, delivering a win to chipmakers and boosting US efforts to expand the industry domestically.
Companies such as Intel Corp, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and Micron Technology Inc would be eligible for an investment tax credit of 35 percent if they break ground on new plants before a deadline next year. That is a jump from the existing 25 percent and tops an increase to 30 percent envisioned in a draft proposal.
The semiconductor manufacturing provision was tucked into a nearly 900-page bill that represents the heart of US President Donald Trump’s economic agenda.
Photo: Reuters
US House of Representatives lawmakers are set to take up the legislation with a goal of sending it to Trump for his signature by tomorrow.
Increases to the credit would sweeten a key incentive created under the 2022 CHIPS and Science Act, a bipartisan law signed by former US president Joe Biden. The program also includes US$39 billion in grants and as much as US$75 billion in loans for manufacturing projects, designed to boost the US semiconductor industry after decades of production shifting to Asia.
The tax credit, which is not capped, was already likely to be costlier than those other forms of subsidies — a function of how much investment the CHIPS Act has spurred. In almost every case, it would account for the greatest share of incentives going to any one company, including those that did not win grant awards. Major beneficiaries of the grant program include Intel, TSMC, Micron and Samsung Electronics Co.
Trump earlier this year called for repealing the CHIPS Act, but US lawmakers have shown little desire to eliminate subsidies that provide high-paying jobs in their districts, in a sector seen as critical to national security. Meanwhile, the US Department of Commerce has continued to implement the grant program — while urging larger investments and reworking terms of awards that took months to negotiate.
So far, the Trump administration has secured increases in promised investment from TSMC, Micron and GlobalFoundries Inc — which the White House has touted as evidence that Trump’s policies are working. None of those included additional CHIPS Act grants beyond what had already been finalized or proposed. Still, more company spending on projects very likely means more foregone government revenue in the form of tax credits — a number that would grow if the US Senate bill becomes law.
Companies that commence projects by the end of next year could continue to claim credits for continuous construction after that date — a policy aimed at getting sites started while recognizing that chip factories take years to build.
Cairo’s new monorail slices across the city skyline, running above the familiar chaos of blaring horns and aging buses’ exhaust fumes that mark rush hour below. The US$4.5 billion monorail, opened this month, is among Egypt’s most prominent new transport projects, part of a debt-funded infrastructure drive criticized for sapping state finances while bringing limited benefits to most of the country’s 109 million people. “It feels like you’re in a different country,” said Ramy Sayed, a restaurant manager, aboard a driverless Innovia 300 train. “No noise, no traffic, we’re not used to this.” The eastern line runs 56km from the bustling middle-class
Starlux Airlines Co (星宇航空) today unveiled a long-haul network expansion plan at a shareholders’ meeting in Taipei, including direct flights to Barcelona, Spain, and Zurich, Switzerland, as well as a service connecting Taipei, Sydney and New Zealand. Starlux is to become the first Taiwanese carrier to offer non-stop services to the two European cities, while the inaugural oceanic route is expected to expand transit opportunities within the Australia-New Zealand market, Starlux said. Flight services to Chicago, Dallas, Washington and New York are under evaluation, the airline added. Prior to the shareholders’ meeting, the airline earlier this year announced that it would be
Taiwanese firms have increased investment in the Philippines in recent years as Manila’s ties with Washington deepen and global supply chains continue to shift away from China, an expert at the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The Philippines had not been among Taiwanese investors’ top choices in Southeast Asia, CIER Taiwan ASEAN Studies Center director Kristy Hsu (徐遵慈) said at a seminar in Taipei. However, Taiwan’s investment in the country has grown significantly since the COVID-19 pandemic, reaching US $257 million last year, a high in recent years, she said. Although Taiwan’s total investment in the Philippines still lags
Taiwanese prosecutors suspect that three people successfully smuggled at least one shipment of Nvidia Corp artificial intelligence (AI) chips to China after first exporting them to Japan, people familiar with the matter said. The trio was detained last week by the Keelung District Prosecutors’ Office for allegedly falsifying documents related to exports of Super Micro Computer Inc servers containing advanced Nvidia chips, which the US has barred from sale to China without a license from Washington. The move marked Taiwan’s first public crackdown on AI chip diversion after years of pressure from the US to take a more active role in curtailing
RSS