Rare Earth Magnet Manufacturing Production Tax Credit Act of 2023
Impact
The bill's implementation is expected to significantly impact the manufacturing landscape by encouraging companies to establish or expand their facilities within the U.S. to qualify for these tax credits. By offering such incentives, the legislation seeks to reduce dependency on foreign sources for these critical materials, which are essential for various industries, including electronics and renewable energy technologies. Additionally, the bill includes provisions to phase out credits for products manufactured after 2032, which creates a sense of urgency for companies to act swiftly in order to take full advantage of the benefits offered.
Summary
SB3521, known as the Rare Earth Magnet Manufacturing Production Tax Credit Act of 2023, aims to boost the domestic production of rare earth magnets by providing financial incentives in the form of tax credits. This bill introduces a credit for manufacturers producing rare earth magnets within the United States, facilitating economic growth in the manufacturing sector. The proposed credits are set at $20 per kilogram of rare earth magnets produced, escalating to $30 per kilogram if at least 90% of the component materials are sourced domestically, thereby promoting local supply chains.
Contention
Discussions surrounding SB3521 highlight concerns regarding the sourcing of materials required for the production of rare earth magnets. The bill prohibits companies from receiving credits if any component materials come from non-allied foreign nations, which could lead to supply chain disruptions for businesses reliant on materials sourced from such countries. Critics argue that this stipulation, while aiming to enhance national security, may inadvertently complicate the manufacturing process and increase costs for producers. The debate reflects broader tensions over balancing economic policy with trade relations and domestic security considerations.
Obtaining National and Secure Homeland Operations for Rare Earth Manufacturing Act of 2023 or the ONSHORE Manufacturing Act of 2023 This bill sets forth provisions to support secure supply chains of rare earth elements. A rare earth element means a natural element associated with (1) the metallic element scandium, with atomic number 21; (2) the metallic element yttrium, with atomic number 39; or (3) any of the series of 15 metallic elements between lanthanum, with atomic number 57, and lutetium, with atomic number 71, on the periodic table. The Department of Energy (DOE) must establish a program that provides financial assistance for facilities located in the United States that produce finished rare earth products from purified rare earth elements. Financial assistance may be provided to (1) construct such facilities, (2) support workforce development for the facilities, or (3) support site development and technological upgrade for facilities. The Department of the Treasury may establish the Minerals Security Partnership Fund to support the development and adoption of a secure supply chain for rare earth elements. DOE must also establish an initiative with educational, workforce training, and apprenticeship programs relating to advanced rare earth element mining, separation, processing, metallurgy, and advanced equipment maintenance capabilities. In addition, the President must develop a plan of action for using the authorities available under the Defense Production Act of 1950 to establish or enhance a domestic production capability for finished rare earth products and related technologies.
Relative to tenant and contract manufacturers of beer, wine, and liquor; allowing pharmacists to administer influenza, COVID-19, and other FDA licensed vaccines without explicit approval from the general court; and, restricting the purchase of real property on or around military installations.