RALEIGH … NCEITA says the General Assembly’s Alternative Research and Development Tax Credit that Governor Mike Easley signed in to law as part of a new budget on Tuesday will help grow knowledge jobs in the state.
“This research and development credit opens a whole near era for the state,” says Joan Myers, president and chief executive officer of the North Carolina Electronics and Information Technology Association. NCEITA, the largest trade group for technology-related companies in the state, has been lobbying furiously for the legislation over several years.
“The outcome of this will be to increase jobs,” Myers tells Local Tech Wire. “This is a most significant victory.
“I applaud this General Assembly for its commitment to the 21st century. This is very, very exciting.”
Steve Parrott, NCEITA chairman and chief executive for Sprint in the Carolinas, called the provision, “The single most significant piece of legislation that the General Assembly has passed to grow knowledge jobs in North Carolina. We are pleased the state legislature can see the tremendous ripple effect that increased R&D spending will have on North Carolina’s economy,” he said in a statement.
The new provision removes the R&D tax credit from other legislation known as the Bill Lee Act and makes the credits more accessible and user friendly for every type of business in the state, NCEITA says.
The new credit offers a flat rate to small and mid-sized companies that steps up according to an easily calculated rate depending on where in the state the company is located. The rate is higher in rural areas.
“It encourages companies to consolidate their R&D operations in North Carolina,” Myers adds. “Additionally, the new credit encourages private spending on R&D at colleges and universities statewide.
“When you increase R&D, we see from other state data, you grow knowledge jobs. R&D is people … really smart people.”
NCEITA says the new provision also increases North Carolina’s economic competitiveness.
“Research and development is the heart beat of the technologies industry, and North Carolina’s ability to provide a globally competitive business environment for technology innovation is key to job growth and our states’ long term competitiveness,” Myers says.