Senate Tax Bill Boosts Incentives for Semiconductor Manufacturers Under Chips Act

The Senate''s draft tax bill proposes increasing the tax credit for semiconductor manufacturers to 30%, up from the current 25%, to spur factory investments before the benefit expires in 2026. This adjustment aims to reinforce domestic production under the Chips and Science Act, a cornerstone of President Biden''s 2022 policy to counter the shift of semiconductor manufacturing to Asia.

Intel Corp., Taiwan Semiconductor Manufacturing Co., Samsung Electronics Co., and Micron Technology Inc. stand as primary beneficiaries, with tax credits forming the bulk of incentives. Meanwhile, former President Trump''s call to repeal the Act has found little traction among lawmakers, who value the high-paying jobs it generates.

Commerce Secretary Howard Lutnick and other officials are renegotiating deals with semiconductor makers, ensuring the legislation''s goals remain on track despite political headwinds.