By Nick Givas | Fox News
Three Republican U.S. senators introduced legislation on Thursday aimed at increasing American manufacturing to help limit the nation’s dependence on China for prescription drugs, medical supplies and devices.
Sens. Kelly Loeffler, R-Ga., Joni Ernst, R-Iowa., and Ted Cruz, R-Texas, introduced the “Bring Entrepreneurial Advancements to Consumers Here In North America – or the “Beat China Act – to “incentivize pharmaceutical and medical device and supply manufacturers to relocate to the United States,” according to a press release from Loeffler’s office.
The bill is the Senate companion to the “Beat China Act” (H.R. 6690) in the House of Representatives. It would alter the tax code to provide incentives to businesses willing to relocate the production of pharmaceuticals, medical devices and other supplies to the U.S.
“For too long, our manufacturing has moved overseas, taking American jobs, jeopardizing our supply chains and forcing us to depend on competitors,” Loeffler said in a statement. “The COVID-19 pandemic has shown us just how dangerous it is to rely so heavily on other countries, including China, for critical, life-saving products like drugs and medical devices as well as supplies like gowns, masks and swabs. It is time we incentivize companies to bring those factories and jobs back to the United States.”
Ernst said the coronavirus crisis should serve as a warning to the U.S. about how vulnerable the country’s supply chain is when it comes to medication and medical supplies.
“The COVID-19 pandemic has been what I call a ‘great awakening’ when it comes to the vulnerabilities in our supply chain,” she explained. “It’s clear now, maybe more than ever, that our nation has become all too dependent on the Communist Party of China for items like PPE, prescription drugs, and other essential medical supplies. We need to fix that.”
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Ernst added, “There’s no doubt we can find ways to produce and manufacture goods and supplies right here in the U.S., and this bill is a good step toward that end.”
Cruz claimed China has already threatened to cut America off from certain necessary items and said the U.S. has become so dependent on Chinese production that the threat must be taken seriously.
“Mouthpieces of the Chinese Communist Party have threatened to cut off U.S. access to life-saving pharmaceutical products,” he said. “Because so much of our medical supply and manufacturing has been outsourced to China, this is a credible threat that if they were to follow through on, would be not just economic warfare but real warfare, endangering American lives.”
Companies that qualify for the incentives would also be able to have non-residential real property purchases considered to be 20-year property instead of 39 years. The senators say this change would allow companies to be eligible for “bonus depreciation.”
Manufacturers who move to the U.S. will also be able to exclude from gross income, any gain earned on the disposition of assets in the country the company is moving from. “This will prevent companies from taking unnecessary hits from taxes if they choose to move to the United States,” according to the Senate press release.
Businesses must meet the same level of production, however, that they did in the country of origin, in order to be eligible for these benefits. Nick Givas is a reporter with Fox News.
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