Texas Insider Report: WASHINGTON, D.C. – U.S. Sens. Ted Cruz (R-Texas), Kelly Loeffler (R-Ga.), and Joni Ernst (R-Iowa) introduced the Bring Entrepreneurial Advancements to Consumers Here In North America (BEAT CHINA) Act to incentivize pharmaceutical and medical device and supply manufacturers to relocate to the United States.
“Mouthpieces of the Chinese Communist Party have threatened to cut off U.S. access to life-saving pharmaceutical products,” Sen. Cruz 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. I’ve called for structural, and bold initiatives to address our dependencies on China, and am proud to join my colleagues on this important measure to bring medical manufacturing and development back to our shores.”
“For too long, our manufacturing has moved overseas, taking American jobs, jeopardizing our supply chains and forcing us to depend on competitors,” Sen. Loeffler said. “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.”
“The COVID-19 pandemic has been what I call a ‘great awakening’ when it comes to the vulnerabilities in our supply chain. 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,” Sen. Ernst said. “While China is our trade partner, there’s no doubt we can find ways to produce and manufacture goods and supplies right here in the US, and this bill is good step toward that end.”
As a member of the Senate Foreign Relations Committee, Sen. Cruz is leading the charge in the Senate to fundamentally reassess the U.S.-China relationship. To that end, Sen. Cruz is working to:
- End U.S. dependence on China, including expanding medical partnerships with U.S. allies like Israel and bringing home the supply chain for rare earth elements and other critical minerals.
- Hold China accountable for the type of medical censorship and suppression that fueled the coronavirus pandemic.
- Combat China's propaganda campaign in the U.S., including stopping the Chinese Communist Party using radio stations in Mexico or Canada to propagandize to Americans, and cutting off Hollywood studios' access to assistance they receive from the federal government if they censor their films for screening in China.
- Counter Chinese espionage by prohibiting U.S. federal employees from conducing official business over platforms run by Tencent, Huawei, ZTE and other CCP-backed companies.
- This bill would amend the tax code to provide incentives to companies to relocate the manufacturing of pharmaceuticals, medical devices and supplies to the United States.
- Medical supply and pharmaceutical companies that move from a foreign country to the United States can have non-residential real property purchases considered to be 20-year property instead of 39 years, a change that will allow companies to be eligible for “bonus depreciation” and the purchase of the property to be fully deducted in the first year.
- Qualifying companies 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.
- In order for companies to qualify for these tax incentives and to ensure the domestic production of materials, companies must adhere to at least the same production levels in the United States as they had in the country they’re leaving.