US Capitol Capsule: Manufacturing incentives, R&D credit at heart of Obama tax fix

With almost lightening speed, criticism about the Obama administration's plan to overhaul the US tax system without raising the deficit began flying around Washington within moments of the document's 22 February release – mostly for the framework's lack of details. But one proposal included in the plan drew immediate praise: Expanding, simplifying and making permanent the research and experimentation tax credit – commonly called the R&D tax credit – in which the biopharmaceutical industry stands to benefit.

The Obama administration's proposal to reform the US tax system, which fundamentally has been left untouched for nearly 25 years, seeks to cut the corporate tax rate from the current...