Texas Manufacturing Seeking to Become More Competitive
The reintroduction of the R&D tax credit is being hailed as a positive move by many manufacturing firms in Texas. According to the Austin Business Journal, it is believed that the new research and development tax credits and incentives could see a hive of activity resulting in over 90,000 jobs and $13billion being spent on manufacturing. All of this new activity should help Texas to catch up with the other R&D initiatives that are implemented in other states.
New Opportunities for Manufacturers
The reintroduction of the R&D tax credit will give manufacturers more options on how to develop their businesses further. Company owners are now able to choose between the option of using the franchise tax credit and a sales tax exemption that is able to be spent on software, equipment and necessary materials to be used in research and development.
Texas is expected to undertake multiple new investments that will create employment opportunities across the state. Innovation and efficiency will increase as a result, making the R&D tax credit a real game changer. Tony Bennett, the president of the Texas Association of Manufacturers is confident that the R&D tax credit is one of the initial first phases that will provide the opportunity for firms to raise questions, ideas and problems that can be developed in labs, in their production facilities or in the field that will allow the introduction of new products and solutions that will drive the economy in Texas further.
It’s Not all Lab Work
Many of the small to mid-sized business owners assume the R&D tax credit is something for the big boys in business. This is not the case. Texas R&D Tax Credit Solutions work with many companies, from start-ups to moderate sized organisations, assisting them with their R&D planning and applications. As a result, the businesses are able to receive the R&D tax credits that can be worth tens of thousands or even millions of dollars. These are the firms that are able to expand and grow and invest money into their business to create new jobs. This isn’t the only misconception. Another presumption concerns the type of activities that are covered by the R&D incentives. It’s not all lab work and scientists in white coats. The incentive can be applied to dealing with problems and focusing on how to make a product cost less, work harder, faster or to make it more environmentally friendly.
Until now Texas was one of just seven states in America that didn’t use the R&D tax credit. Now Texas is being given what is seen as a lifeline by many businesses that should see many positive actions taking place in manufacturing. If you are interested in finding out how your business can benefit from the incentive, please contact our team of R&D tax specialists to discuss your options.