Legislation would hammer manufacturers with new taxes, undermine pharmaceutical research, kneecap new investment
PHOENIX (Aug. 1, 2022) – The Arizona Chamber of Commerce & Industry and Arizona Manufacturers Council oppose the tax increases included in the recently announced deal between Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.V., and are urging Sen. Kyrsten Sinema and Sen. Mark Kelly to reject the so-called Inflation Reduction Act and stand with Arizona job creators.
“The Arizona Chamber strongly opposed the original Build Back Better bill for the damage it would inflict on the Arizona and U.S. economies, and we oppose this version’s tax hikes and its anti-innovation provisions, too,” Arizona Chamber President and CEO Danny Seiden said. “Giving a bad bill a new name doesn’t make it any better. We would urge Sen. Sinema and Sen. Kelly to stop this version of the bill.”
The legislation is especially damaging to Arizona manufacturers, calling for the imposition of a new 15% “book” tax, which would greatly discourage and diminish capital-intensive investment, and it undermines the research and development of new pharmaceuticals with its drug pricing scheme.
“Arizona manufacturers are already struggling under record-high inflation, supply chain backlogs, and a major labor crunch. Now is not the time to hammer manufacturers with new taxes,” Arizona Manufacturers Council Executive Director Grace Appelbe said.
Seiden said the bill’s attempt to spur investment in emerging energy technology through tax credits should be separated as a standalone bill.
“Arizona has shown it can be a leader in the development and manufacture of new energy technology, but if senators want to support this bill’s investment and production tax credits, they should do so in a separate bill,” he said. “The negative implications of the tax and drug pricing provisions of the bill are too damaging to pass it in its present form.”
The Arizona Chamber in the 2022 state legislative session was the leading supporter of legislation signed into law by Gov. Ducey that simplified and reduced the tax burden on business personal property, and the Chamber was a vocal proponent of the recently passed CHIPS and Science Act to encourage the domestic production of semiconductors.
“If this Schumer-Manchin legislation were to become law, it would wipe out the tremendous progress we just achieved at a state and federal level,” Seiden said. “Last year’s infrastructure bill and this year’s semiconductor bill showed that the U.S. Senate can still accomplish big things on a bipartisan basis. Sen. Sinema and Sen. Kelly should reject this bill and bring their colleagues back to the drawing board.”
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