Article: R&D tax credit: free lunch

If Americans could vote on their favorite business tax break, the research and development tax credit might top the balloting. The public supports it because new technology fattens paychecks, saves lives and makes for more realistic video games. Politicians like it because Corporate America loves it.

Even the bean counters at the Treasury are fans because the credit is designed to yield the maximum bang for a tax buck.

Indeed, a freshly minted study by Coopers & Lybrand concludes that the research and development tax credit actually delivers the free lunch that supply-side tax cutters promised, eventually returning more to the government in revenues as the economy grows than it initially ...

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