Relating to a franchise tax credit for certain research and development activities by taxable entities in the aerospace industry.
Impact
If enacted, HB2390 would amend Chapter 171 of the Texas Tax Code, adding a new subchapter that outlines eligibility criteria, calculation methods for the tax credit, and the responsibilities of the Comptroller in reporting on the effectiveness of the program every two years. The overall goal is to foster a conducive environment for companies operating in the aerospace sector, enhancing the state's economy by encouraging innovation and expanding the talent pool in high-skilled job sectors.
Summary
House Bill 2390 introduces a franchise tax credit aimed at supporting research and development initiatives in the aerospace industry within Texas. The bill stipulates that entities engaged primarily in the aerospace sector are eligible for a 5% credit against franchise taxes, as long as their research activities occur within the state. This move is expected to incentivize investments in high-tech projects and stimulate job creation, positioning Texas as a competitive site for aerospace research and development efforts.
Contention
However, there may be arguments regarding the effective allocation of state resources, particularly concerning potential inequities between industries. Critics might express concerns that focusing tax benefits on a specific industry could undermine broader economic strategies that serve a wider array of sectors. Furthermore, there may be calls for accountability in measuring the impact of these tax credits on actual job creation and investment in Texas, to ensure they fulfill the intended economic outcomes.
Relating to measures to enhance and maintain the quality of state universities, including funding and incentives to support emerging public research universities, to the abolition of the higher education fund, to the institutional groupings under the Texas Higher Education Coordinating Board's accountability system, to the independent status of Lamar Institute of Technology, to research conducted by public universities and other state entities, and to the authorization of revenue bonds for certain institutions of higher education.