U.S. Sens. Mark R. Warner (D-VA) and Tim Kaine (D-VA) today led a bipartisan group of six Senate colleagues in introducing The Startup Act to jumpstart investment and job creation by new businesses.
The bipartisan legislation makes a series of targeted proposals in tax, regulatory and immigration policy. It would create both Entrepreneur and stem visas for highly-educated and entrepreneurial immigrants educated in the U.S., allowing them to stay here and create jobs. The legislation also modifies the tax code to encourage investment in new businesses, seeks to simplify and improve regulations around startup businesses, and works to accelerate the transfer of university research from the laboratory to the marketplace.
Other original Startup Act cosponsors include Sens. Jerry Moran (R-KS) Chris Coons (D-DE), Roy Blunt (R-MO) and Amy Klobuchar (D-MN).
“In the new Congress, we are focused on continued growth in the economy, and we’re looking for ways to ensure that the U.S. is able to compete and win the global competition for talented innovators and entrepreneurs,” Sen. Warner said. “Our bipartisan legislation provides commonsense tools and greater support for startups and the creation of more high-wage, high-skill jobs in Virginia and across the country.”
“First-generation Americans have always found a home for their ideas and entrepreneurial spirit in America. That’s why I’m pleased to once again co-sponsor the Startup Act,” said Sen. Kaine. “By providing entrepreneurs and foreign students who are educated in American universities with the ability to pursue career opportunities here, the Startup Act will help grow Virginia’s diverse talent pool, fill stem vacancies in American companies and create employment opportunities in new business ventures for American workers.”
This bill is supported by numerous groups, including The Consumer Electronics Association, TechAmerica, Financial Services Forum, the National Small Business Association, Google, CONNECT, CTIA, Engine Advocacy, Computer and Communications Industry Association, Angel Capital Association, ITI, and the northern virginia Technology Council.
“NVTC appreciates Senators Warner and Kaine’s continued commitment to fostering startups, innovation, and entrepreneurship,” said Bobbie Kilberg, President and CEO of the Northern Virginia Technology Council. “The Startup Act addresses key obstacles that many entrepreneurs today face, including recruiting and retaining talent, accessing capital , commercializing technology, and generating new intellectual property. These reforms will greatly benefit Northern Virginia’s growing hub of leading technology companies and help innovative young businesses across America grow and prosper.”
Research shows that for close to three decades, companies less than five years old have created almost all net new jobs in America – averaging about three million jobs each year. Additionally, immigrants to the United States have a long history of creating businesses in America. Of the current Fortune 500 companies – including Apple, Google and eBay – more than 40 percent were founded by a first- or second-generation American. These American companies employ more than 10 million people. Both American and foreign-born entrepreneurs are needed to jumpstart the economy through the creation and growth of new businesses.
The Startup Act includes the following provisions:
- Creation of Entrepreneur Visa: Creates an Entrepreneur’s Visa for legal immigrants, so they can remain in the United States, launch businesses and create jobs;
- Creation of stem Visa: Creates a new stem visa so U.S.-educated foreign students, who graduate with a master’s or Ph.D. in science, technology, engineering or mathematics, can receive a green card and stay in this country where their talent and ideas can fuel growth and create American jobs;
- Elimination of Per-Country Caps: Eliminates the per-country caps for employment-based immigrant visas – which hinder U.S. employers from recruiting the top-tier talent they need to grow
- Capital Gains Tax Exemption for Startups: Makes permanent the exemption of capital gains taxes on the sale of startup stock held for at least five years – so investors can provide financial stability at a critical juncture of firm growth;
- R&D Credit for Startups: Creates a limited research and development tax credit for young startups less than five years old and with less than $5 million in annual receipts. This R&D credit is designed to allow startups to offset employee taxes – freeing up resources to help these young companies expand and create jobs;
Commercialization: Uses existing federal R&D funding to support university initiatives designed to bring cutting-edge research to the marketplace more quickly where it can propel economic growth;
Regulatory Reform: Requires all government agencies to conduct a cost-benefit analysis of all proposed “significant rules” with an economic impact of $100 million or more. This new requirement will help determine the efficacy of regulations and their potential impact on the formation and growth of new businesses; and
Reports on State and Local Startup Policies: Directs the U.S. Department of Commerce to assess state and local policies that aid in the development of new businesses. Through the publication of reports on new business formation and the entrepreneurial environment, lawmakers will be better equipped to encourage entrepreneurship with the most successful policies.