In testimony before the California Assembly Committee on Revenue & Taxation, ITIF president Rob Atkinson urged state lawmakers to take steps to reform and expand tax incentives for innovation. Specifically, he recommended the state’s R&D tax credit be harmonized with the federal Alternative Simplified Credit and proposed revisions to the state’s basic research tax credit. He also urged the adoption of a “patent box” that allows profits from innovation to be taxed at a lower rate in order to drive job creation in California. Using tax policies such as these would help California harness the potential of its significant innovation infrastructure and entrepreneurial culture as well as compete with other states and countries at the cutting edge of innovation.
