by Rob Keys
Posted 3/25/2011 04:06 pm
Updated 2 years ago
U.S. Treasury Secretary Tim Geithner's visit to NanoMech on Friday provided a real-world setting for a message that changes to the tax code can allow companies to spend more on research and boost the national economy.
NanoMech is a nanotechnology manufacturer with a plant and laboratories in Springdale. Geithner's visit was part of a day that also included a meeting with leaders from local entities -- Wal-Mart Stores Inc., Tyson Foods Inc., Arvest Bank and the University of Arkansas, among them -- at the Arkansas World Trade Center in Rogers.
The Obama administration wants to make a research and experimentation tax credit permanent. A report issued Friday in conjunction with Geithner's visit said that would result in companies spending more on research for at least the next decade.
"This proposal should be part of a comprehensive reform of the corporate tax system to make American companies more competitive," Geithner said in a prepared speech.
"Reform that eliminates loopholes and preferences, lowers the tax rate on investments in the United States and replaces a complicated muck of temporary provisions with a more powerful, but more targeted set of permanent incentives, like the R&E tax credit."
Arkansas Republican Congressman Steve Womack also attended the event, and said while he hasn't "drilled down" into the specifics of the proposed credit, agrees "in principle" with such incentives.
Womack added that he remains firm in the idea that Congress should be "careful that we guard our spending habits."
Both Geithner and Womack, along with NanoMech CEO Jim Phillips, spoke at one of the company's lab spaces.
Geithner's speech lasted about six minutes. After, he took a handful of questions. Among them was whether the earthquake and tsunami in Japan might stall economic recovery in the United States.
Geithner expressed confidence in Japan's ability and resources to recover, and added he isn't "particularly concerned about that, but of course a lot depends on how the events in Japan unfold."
As for domestic concerns, Geithner said "the underlying strength of the economy is OK," but that plenty of work remains to be done.