WASHINGTON--The $500 billion fiscal 1999 budget approved by Congress and signed by President Clinton late last month contained some rewards for the high-tech and biotech business.
The budget delivered extended research and development tax credits and increased caps on visas for high-tech workers.
The widely supported Research and Experimentation Tax Credit, first included in the 1981 tax bill to boost US competitiveness, was extended through September 30, 1999, and made retroactive to July 1, 1998. At an estimated annual cost of $2 billion to the US Treasury, the credit serves as an incentive for increased research spending in the biotech and other sectors.
Another victory for the high-tech sector was the American Competitiveness and Workforce Improvement Act, attached to the Omnibus Appropriations Bill. The bill raised caps on H1-B temporary work visas from the current level of 65,000 annually to 115,000 annually for the next two years, but calls for the cap to be reduced again in 2001 to 107,500 and dropped back to 65,000 level in 2002.