2021 Marcum National Manufacturing Survey

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ECONOMICS, POLICY, AND TAXES

TAX INCENTIVES Most Manufacturers Use Tax Incentives Our survey revealed that 80% of respondents use some kind of tax incentive. The R&D tax credit, which we detail elsewhere in this report, was the most popular, with companies also using accelerated depreciation/cost segregation, the Employee Retention Tax Credit, and various state and local credits. Given the many legacy tax incentive programs and newer ones that have emerged during the pandemic, it could be a good time to carefully review how and where you’re using tax incentives to ensure you’re not leaving money on the table.

IMPACT OF BIDEN ADMINISTRATION Administration Change Brings Challenges, Possibilities With a new administration and a new party in power in Washington, we asked how that might affect business. Like the vote in the country itself, the results here were evenly split. While 40% expected either a positive impact or no impact, 40% worried about a negative impact. Another 20% were unsure. Given the possibility of increased spending on projects that benefit manufactures (like infrastructure) coupled with

the likelihood of higher taxes, a split vote is unsurprising. POLICY PRIORITIES AROUND NEW ADMINISTRATION Political Priorities for Manufacturers

Digging deeper, we asked what priorities manufacturers would like the Biden administration to pursue. The top responses, with 51% each, were lower taxes and promoting workforce training. Initiatives to boost domestic manufacturing were a close second, followed by investing in infrastructure and reducing tariffs.

Q34 Are you taking advantage of the following tax incentives?

100%

90%

80%

70%

60%

Employee Retention Tax Credit 31.43% (11)

Accelerated depreciation/cost segregation 42.86% (15)

R&D tax credit 48.57% (17)

50%

State and Local tax credits 31.43% (11)

40%

30%

None of the above 20.00% (7)

20%

Work Opportunity Tax Credit 0.00% (0)

10%

0%