A bipartisan duo is pushing a bill to clarify that tax credits include space-based semiconductor manufacturing.
The Semiconductor Superiority Act would amend the Internal Revenue Code to clarify how the existing Advanced Manufacturing Investment Credit applies to semiconductor manufacturing facilities in outer space, including those in low earth orbit.
Semiconductor manufacturing is the process of transforming raw material into microscopic electronic circuits, used to power everything from smartphones to cars and medical devices.
The bill essentially future-proofs the CHIPS and Science Act’s manufacturing tax credit to cover space-based semiconductor fabrication facilities, anticipating a future where companies like those in the commercial space industry might manufacture semiconductors in orbit.
Introduced Thursday by Sens. Ted Budd, North Carolina Republican, and Michael Bennet, Colorado Democrat, this legislation “eliminates uncertainty for American manufacturers regarding microgravity semiconductor technology, bolstering U.S. global competitiveness” and closing the advanced manufacturing gap with China.
Mr. Budd said the bill gives domestic manufacturers the “green light to develop microgravity semiconductor technology to compete with China.”
“Every day, over 300 million Americans utilize semiconductor chips, whether in smartphones, televisions, bank ATMs, or home appliances, but now that China has already implemented space-based chip fabrication into its supply chain, the U.S. is at risk of losing our global competitive edge,” he said in a statement. “Given that several American companies are already investing in the equipment, launch capacity and advanced chips manufacturing, we already have momentum, and we cannot afford to stall.”
Mr. Bennet said that because China is racing to manufacture semiconductors in space, “we cannot afford to fall behind.”
“We must act now to protect our competitive edge and drive the next generation of innovation,” he continued.
They hope to boost domestic manufacturing and ensure that the U.S. controls a larger share of chip fabrication to “safeguard advanced U.S. supply chains in the event of a future conflict.”
Reps. Vern Buchanan, Florida Republican, Terri Sewell, Alabama Democrat, and Suzan DelBene, Washington Democrat, have led the companion measure in the House.
