Tax Policy Update: What’s in the House Tax Bill — and What It Means for Electronics Manufacturers

May 14, 2025

This morning, the House Ways and Means Committee advanced a major tax package that includes several provisions supported by IPC. These provisions — including restoring bonus depreciation, immediate R&D expensing, and strengthening the pass-through deduction — were identified by IPC members as key tools that would help them invest, grow, and compete more effectively. While the legislation still has a long way to go before becoming law, its passage out of committee marks a critical step forward.

Here’s what’s in the bill — and what it could mean for electronics manufacturers.

✅ Key Provisions Included in the Bill:

🏗️ Restores 100% Bonus Depreciation

  • Allows businesses to immediately write off the full cost of qualifying equipment and machinery investments.
  • Helps manufacturers reinvest in advanced tools, automation, and production lines — a top priority identified by IPC members.

🔬 Restores Immediate Expensing for Domestic R&D

  • Reverses the current amortization of R&D expenses and allows companies to fully deduct domestic research costs in the year incurred.
  • Encourages continued investment in innovation — especially for small and mid-sized firms.

🧾 Expands and Makes Permanent Section 199A Pass-Through Deduction

  • Increases the deduction for qualified business income to 23% and simplifies the rules for small and medium-sized businesses.
  • Supports the many IPC members organized as S corporations or partnerships.

❌ What’s Not in This Version of the Bill

While the bill includes several of IPC’s top priorities, it does not include new or expanded tax credits targeted specifically at electronics manufacturing. Proposals such as:

  • A 25% tax credit for sourcing U.S.-made printed circuit boards (PCBs)
  • Expansion of the Section 48D and 45X credits to include PCB and electronics assembly production

…were not incorporated into this version of the bill.

Given the current focus on limiting the bill’s impact on the national debt, lawmakers prioritized restoring and extending existing tax provisions rather than creating new ones. IPC understands the constraints facing Congress and appreciates the inclusion of meaningful pro-manufacturing policies in this package.

We will continue working with policymakers to make the case for targeted incentives that address the specific gaps in the U.S. electronics manufacturing ecosystem — especially as future legislative opportunities arise.

💬 IPC CEO John Mitchell: "A Strong Step Forward"

“These provisions are proven tools that help manufacturers reinvest, innovate, and grow,” said IPC President and CEO Dr. John W. Mitchell.
“We’re encouraged by this strong step forward and urge Congress to keep up the momentum. With continued leadership in the House and action by the Senate, a tax package that supports American innovation, investment, and industrial capacity can be enacted this year.”

🛠️ What Happens Next?

  • The bill now moves to the full House of Representatives for consideration.
  • The Senate must also act; discussions are ongoing.
  • Congressional Republicans have targeted a July 4 date for final passage.
  • IPC will continue pressing lawmakers to support provisions that benefit the entire electronics manufacturing supply chain.

Want to learn more or share your perspective? Contact us at friends@ipc.org or visit Advocating for the Global Electronics Industry | IPC International, Inc.