Lilly believes tax reform that encourages economic growth and innovation within the United States is key to creating high-quality jobs for Americans. The U.S. needs a structure that promotes innovation within its borders. Current tax policy creates uncertainty for U.S. global companies by threatening tax increases and limiting tax credits.
By focusing on several key internationally competitive tax reform priorities, significant investments will be made in the United States (by companies, vendors, contractors, and employees), bolstering the U.S. economy.
Lilly has identified the following as high priorities for corporate tax reform:
- Enact a territorial system for the taxation of foreign earnings, including:
- A 95 to 100% exemption for foreign dividends.
- Reasonable transition rules that address accumulated foreign earnings.
- Anti-base erosion rules that keep U.S. companies on equal footing with their competitors.
- Enact incentives for innovation, such as:
- An enhanced R&D credit by increasing from the current rate of 14% to 17-20%.
- Lower U.S. taxation on income derived from U.S.-developed and commercialized intellectual property, similar to policies embraced by European nations.
- Adopt a corporate tax rate similar to other OECD countries, with:
- A set corporate tax rate of 20 to 25% that aligns with other OECD countries.
With a focus on these policies, the U.S. can continue to be internationally competitive, encouraging innovation and job growth.