R&D Tax Credit Top Legislative Priority for VA Bioscience Industry
The Virginia Biotechnology Association today announced that passage of a research and development tax credit will be the Association’s top legislative priority during the 2011 Session of the Virginia General Assembly.
The proposed credit would amount to 15% of the qualified research and development expenses incurred by advanced technology companies in the Commonwealth. The credit would increase to 20% if such research were conducted in partnership with a public college or university in Virginia. In addition, the amount of the credit that exceeds the company’s tax liability would be returned in cash to that business.
“Virginia is one of only twelve states that do not offer a state R&D tax credit,” said Mark A. Herzog, executive director of the Virginia Biotechnology Association (VABIO). “If we are going to be competitive with other states and ensure that spin-out companies from Virginia universities can succeed, then this bill should be a top legislative priority for the Commonwealth.”
According to a recent report by the Battelle Memorial Institute and the Biotechnology Industry Organization (BIO), 38 states offer an R&D tax credit as part of their job creation strategies. An R&D tax credit was recommended by Governor Bob McDonnell’s Commissions on Higher Education and Economic Development and Job Creations this fall.
“In the 1990s, Virginia emerged as the nation’s leader in attracting technology related businesses, but in recent years many other states have been more aggressive than we have been in implementing economic development strategies that are specifically targeted to new and emerging technology companies. We must reverse this trend and reassert Virginia as a leading location for the technology related businesses of the 21st century. The implementation of a meaningful research and development tax credit is a central part of that effort, and we look forward to working with our friends from the Virginia Biotechnology Association in advancing this important legislative initiative,” said Lieutenant Governor Bill Bolling.
Delegate Ben Cline, a Republican from Amherst, and Senator Mark Herring, Democrat from Leesburg, will be the chief patrons for the legislation.
“BIO has strongly advocated for federal and state R&D credits because they work,” said Patrick Kelly, vice president of state government relations for BIO. “Considering the current economic climate, we believe the time has come for Virginia to enact an R&D tax credit to bolster commercialization of technology-based jobs.”
The 2011 Session of the Virginia General Assembly will convene on January 12th at the state capitol in Richmond.
