Tech industry presses Congress on R&D tax credit; cybersecurity bill looks unlikely

The Hill
By Gautham Nagesh – 11/16/10 10:53 AM ET

A leading technology industry group is urging Congress to extend an expired federal research and development tax credit and pass cybersecurity measures during the lame-duck session.

“This Congress still has the opportunity to help hone America’s competitive edge in the global innovation economy,” said TechAmerica President Phil Bond. “The R&D Credit is a jobs credit — an extension should be a no-brainer in a time of uncertain recovery.”

TechAmerica issued a statement Monday calling for lawmakers to act on key technology issues before adjourning the 111th Congress. The technology industry has lobbied heavily for the extension of the tax incentive; TechAmerica estimates its expiration has cost more than 100,000 well-paying jobs so far this year.

Bond also called for Congress to pass legislation reforming the Federal Information Security Management Act (FISMA), which governs how federal agencies secure their networks. The law is widely viewed as outdated and overly focused on compliance rather than on monitoring cyber threats.

Sen. Tom Carper (D-Del.) has crafted a FISMA reform bill with bipartisan support that has been attached to the ongoing effort to pass comprehensive civilian cybersecurity legislation. But sources tell The Hill that attaching Carper’s bill to a larger authorization or appropriations measure is more likely than passing stand-alone cybersecurity legislation.

The odds of a comprehensive cybersecurity bill passing have diminished greatly with the Republicans taking control of the House. While House GOP leaders have been mum on the subject, Senate Republicans including John McCain (Ariz.) have objected to what they view as attempts to regulate cybersecurity for private-sector firms.

Finally, Bond called for the delay of a pending 3 percent withholding requirement for government contractors set to take effect in 2012. Bond argued contractors and federal agencies are already facing significant financial burdens and advocated a two-year delay while the effects of the withholding are studied.