Here are some space-related tax incentive bills that have gone before the U.S. Congress:

*H.R. 2358, the Invest in Space Now Act (sponsors: Rep. Calvert & Rep. Ortiz).

*H.R.914: To amend the Internal Revenue Code of 1986 to provide tax incentives for investing in companies involved in space-related activities.  Sponsor: Rep Rohrabacher, Dana [CA-46] (introduced 2/25/2003).

Congressional bill-tracker: Http://thomas.loc.gov

1) INVEST IN SPACE NOW ACT (OF 2001)

2) SPACEPORT EQUALITY ACT (OF 2001)

3) ZERO GRAVITY, ZERO TAX ACT (OF 2001)

4) SPACE TOURISM PROMOTION ACT OF (2001)

5) THE COMMERCIAL SPACE PARTNERSHIP ACT OF 2000

More proposed legal reforms....

Any others?  Please notify us at: tax@SpaceProjects.com .  

 Http://thomas.loc.gov offers a free way to easily access these space-related  bills´ exact text. For example, regarding the "Invest in Space Now" act, simply search for "H.R. 2177".  It is important to include the letter, or letters, preceding a bill´s number.  Notice how one can also retrieve the bills´ latest status reports, as well as information regarding which elected representatives are acting to support or oppose them.  That overall website also contains Congressional representatives´ contact information, too.

      By the way, of the 10,000 or so bills before Congress each year, supposedly only around 600 become law.   Many of those 600 fail during the initial vote, too.  Proposing still more space tax bills might seem prestigious, but would doing so add sufficiently enough value to justify the resulting potentially counter-productive dilution of efforts?

       For the good of our entire industry and the global economy, we encourage you to please contact your elected representatives and ask them to support the bills that stand the greatest chance of passing.   Means of correspondence (in descending order) regarding the potential impact you can have include personal visits to their office(s), letters or faxes, phonecalls, and e-mails (which are hardly noticed  by Capitol Hill staff-members nowadays).    

     Note: NASA says it encourages the commercialization of space by potentially competing ventures.   We invite those who profit from NASA's currently monopolistic status to encourage the U.S. space agency to live up to its word by not acting to derail the progress of these space tax incentive bills.  

     Interestingly enough, according to St. Louis tax attorney Ransom Wuller, tax credits generally attract four times as much private sector investment to an activity than the amount of revenue that is "lost" by the IRS as a result of that tax credit.   Meanwhile, when the commercial activity would not even exist in the absence of the tax credits, does the IRS really lose anything?

INVEST IN SPACE NOW ACT (HR 2177)

       This bill (HR 2177), which already has practically dozens of sponsors or official cosponsors in the House (including Congressman J.C. Watts), offers a tax credit to investors in commercial space launch vehicle companies.  In order to benefit investors of both small start-up launch companies as well as larger, well-established ones, the proposed legislation offers two categories of tax credits: one for small space vehicle manufacturers and the other for large ones.  There is a limit to the total amount of revenue that can be collectively treated as tax-exempt, too.
       Companies seeking to qualify for the exemption from tax revenue extraction need to apply to the Secretary of Transportation and represent that their development approach is at least reasonably likely to lead to a vehicle which can significantly reduce launch costs.   They must also demonstrate the potential for commercial viability by raising a minimum of $10 million in equity capital "during the year of application".   (Editor's note: this is presumably to avoid overburdening the Secretary with having to review projects that will likely never really get off the ground).  
      Reassuringly enough, "[a]uthorization by the Secretary is deemed granted unless within 120 days of application submission the Secretary determines that the provider has no reasonable possibility of significantly lowering space transportation costs."   Failure to ultimately achieve success will not necessarily result in the company's deauthorization.  The bill's full text, status, and the identify of its growing list of co-sponsors is at the following website:

Http://thomas.loc.gov (HR 2177)         

SPACEPORT EQUALITY ACT

The Spaceport Equality Act (H.R. 1931, S. 1243) would enable U.S. spaceports to raise funds for construction and renovation through tax-free bonds. Similar tax-free treatment ALREADY applies to airports, seaports, high speed rail, mass transit and other transportation projects, but NOT to spaceports. Nevertheless, spaceports exist in California, Florida, Virginia and Alaska. Additionally, the states of Idaho, Louisiana, Mississippi, Montana, Nevada, New Mexico, North Carolina, Oklahoma, Texas and Utah (etcetera) are considering building their own.

Strong bipartisan support exists for this bill, but legislative gridlock delayed its passage during the 1990's.

Http://thomas.loc.gov (H.R. 1931, S. 1243)

According to a Washington Times article, retiring Texas Senator Phil Gramm seems to care much more about permanently repealing the estate tax (which only applies to less than 2% of estates anyway) than about finally getting tax free treatment for the spaceports proposed for his state.  Whatever happened to "Texans first," Phil?

ZERO GRAVITY, ZERO TAX ACT OF 2001

    The "Zero Gravity, Zero Tax Act" (H.R. 2504) purports to amend the Internal Revenue Code of 1986 to "exclude from Federal taxation certain income derived from the manufacture of products and [the] provision of services in outer space." At least based on what we were told prior to the latest version's July 16th introduction, the proposed duration for such preferential tax treatment will now be merely 10 years (as opposed to the former version's 25 year period).

       Previously and perhaps currently as well, tax-excluded income included (among other things) capital gains on the sale or exchange of any stock of a qualified space corporation. To qualify, a corporation would have had to be: 1) domestically-based; 2) organized exclusively for providing products made in space, or services in or from space; and 3) deriving at least 90 percent of gross receipts from the active conduct of providing a qualified space product or service.

     In order to enhance the chances of enactment into law, the bill excluded from preferential tax treatment telecommunications, the launching of property, and any service provided by a weather or other Earth observation satellite. This was not only to minimize the potentially negative impact upon already existing tax revenues, but also to promote NEW space industries and services. The list of nontaxable areas WOULD  have included space tourism, biotech research, pharmaceutical manufacturing and anything else that entrepreneurs could dream up.    We were told that the bill's new version would also exclude pioneering launch ventures from taxation (which is reassuring given how the USA's launch marketshare has gone from nearly 100% two decades ago to just 29% during the year 2000).  

     Meanwhile, at least the former version also granted tariff-free status on the importation of goods manufactured in space. To qualify, the goods must have either been launched from and returned to Earth within the United States, OR manufactured at a facility in outer space which is owned by 1 or more United States persons.

        It is very hard to tax revenue streams that probably would not even exist in the absence of such a bill, and the House Ways & Means Committee is encouraged to take this into account.  Supporters of similar bills in the future hope that someone on the Ways & Means committee would eventually co-sponsor it, and that someone from the Senate would also formally propose it.

Http://thomas.loc.gov (H.R. 2504)

      Congressman Nick Lampson introduced H.R. 2443 on July 10th, 2001.   Its purpose is to create guaranteed loans & capital gains exclusions essentially for the development of facilities and services directly involved with space tourism.   There is also a prohibition (with certain exceptions) against the use of federal facilities by space tourists.   As this bill has practically no sponsors,  and considerable opposition from the space advocacy community (including the Space Frontier Foundation) we expect for substantial amendments to take place before it is taken more seriously.  We therefore refrain from summarizing it in its present form unless it appears to gather as much momentum as the abovementioned 3 bills have.

Http://thomas.loc.gov (H.R. 2443)

THE COMMERCIAL SPACE PARTNERSHIP ACT (INACTIVE)

      U.S. Senator Bob Graham (D-Fla.) introduced the Commercial Space Partnership Act (formerly S 2316) on March 29, 2000. It would haved granted NASA the legal authority to lease real or personal property under its control to public or private businesses, as well as to local, state and other federal government entities. The price: "fair market value", as determined by the NASA Administrator. The bill’s proponents say it would create a new way for NASA to renovate its facilities at relatively minimal taxpayer expense, and also make it more cost-effective for NASA to offer better support to the USA’s launch industry (which now has merely 30% of the world marketshare, while Europe has 50%).

One form of compensation could be money, which NASA could use to cover its share of directly pertinent commercial ventures (subject to the conditions of the original congressional appropriations which made the activities possible). Excess funds would go to the U.S. Treasury’s general revenues.

Compensation to NASA could have ALSO taken other forms. Among them are the constructing of new buildings on NASA’s premises or the renovating of existing facilities. One could even compensate NASA by allowing it to use the improved facilities on NASA’s property. Similarly, compensation could include providing services to NASA such as launches, payload processing or whatever else is suitable.

The lease term contemplated was 20 years, although it could have been extended for no more than 5 additional ones. The NASA Administrator could also require additional conditions as (s)he deemed appropriate to protect the interests of the United States.

Http://thomas.loc.gov (formerly S. 2316)

Http://thomas.loc.gov contains your Congressional representatives´ contact information...
Please let us know how things are going.

Are there any other directly relevant tax reform bills?  
Please notify us at: Tax@SpaceProjects.com

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More proposed legal reforms...

Are corrupt beltway bandits  using Prospace, the supposed "Citizen's Space Lobby" to rob taxpayers?