By Mark Weiner
syracuse.com
(TNS)
WASHINGTON — Micron Technology stands to gain about $5 billion in new tax breaks for its massive chipmaking complex in Central New York after President Donald Trump’s big bill boosted incentives for chip plants.
The bill increases an existing investment tax credit from 25% to 35% for semiconductor manufacturers who build new plants in the United States. The credit can be claimed for the costs of building and equipping new plants.
Micron disclosed in documents last year that the tax credit would be worth about $11.3 billion for the first phase of its project in the town of Clay.
Under the change included in Trump’s bill, the tax credit could now be worth about $16 billion, according to figures compiled by syracuse.com | The Post-Standard.
By far, it would be the single largest government subsidy that Micron receives as it moves forward with construction of the first two of four planned fabrication plants in the town of Clay at a cost of about $48 billion.
Besides the tax credits, the federal government has agreed to provide Micron with $4.6 billion in grants from the federal CHIPS and Science Act for the first two fabrication plants in Clay.
Separately, New York agreed to provide $2.2 billion in tax credits from the state’s Green Chips program, and $1.8 billion in county and state sales tax exemptions.
With the newly expanded federal tax credit, that would bring the potential value of Micron’s government subsidies to about $25 billion for the $48 billion first phase of construction.
Micron says it plans to break ground by the end of this year at White Pine Commerce Park in Clay.
Micron officials told syracuse.com that they have not yet calculated the potential value of the revised Advanced Manufacturing Investment Tax Credit for its Central New York project.
Micron and other semiconductor manufacturers with U.S. expansion plans had lobbied the Republican-controlled Congress to increase the tax credit this year to help make up for increased construction costs.
Construction, labor and material costs increased by an average of 10% in the past year as chipmakers began work on more than 120 expansion projects in the U.S. valued at more than $540 billion, according to industry officials.
Micron has already started building a new chipmaking plant at its headquarters in Boise, Idaho, where it is in the middle of a $15 billion expansion.
The company has bigger plans for Central New York. Micron says it plans to spend $100 billion to build four chip plants in Clay over the next 20 years that would directly employ up to 9,000 people and create up to 40,000 spinoff jobs.
The approval of the increased tax credit in Trump’s bill is a victory for Micron and other chip makers who worried whether their U.S. expansion plans could remain cost competitive with Asia.
The semiconductor manufacturers also had to overcome Trump’s pushback against the CHIPS and Science Act, which provided $52 billion in incentives to encourage the industry to expand in the United States as a national security priority.
The bill championed by U.S. Sen. Charles Schumer, D-N.Y., the Senate Democratic leader, was signed into law in 2022 by President Joe Biden.
Trump called the CHIPS Act a “horrible, horrible thing” during a joint address to Congress in March and told House Speaker Mike Johnson to get rid of the program.
Trump said tariffs on chips made overseas—instead of grants, loans and tax breaks in the CHIPS Act—would be enough to lure manufacturers back to the United States.
Several semiconductor manufacturers responded by renegotiating CHIPS Act deals they had signed with the Biden administration and expanding their U.S. investments under Trump.
Micron said in June that it agreed to spend an additional $30 billion in chipmaking plants in the U.S. None of the extra spending is targeted directly at New York.
While boosting their planned investment, Micron and other chipmakers began lobbying for a bill introduced in May by Rep. Claudia Tenney, a Republican from Oswego County, that would expand the tax credit.
The bipartisan bill included support from Rep. John Mannion, D-Geddes, among 10 Democratic and Republican House members from New York who co-sponsored the legislation.
The Building Advanced Semiconductors Investment Credit (BASIC) Act would have increased the tax credit from 25% to 35% and extended its availability through Dec. 31, 2030.
Tenney’s bill did not advance to a vote in the House, but it provided the framework for the tax policy included in Trump’s bill.
The final version of Trump’s bill that he signed into law did not include an extension beyond the existing 2026 deadline for companies to qualify for the subsidy.
Micron officials say they believe all four plants planned for Clay would be eligible under IRS rules established for the tax credit.
The Advanced Manufacturing Investment Tax Credit allows chip manufacturers to claim the credit for the cost of building and equipping their new plants. The amount of the subsidy is based on what companies spend on their projects.
The tax credit is fully refundable, meaning that companies are entitled to the money even if the tax credit exceeds their federal taxes due for a year.
Micron officials say the tax credits will help close the cost gap between producing chips in Asia and the United States.
Micron CEO Sanjay Mehrotra has said that without the combination of federal grants and investment tax credits, the company would not have agreed to expand in New York or even the United States.
He said labor, production and construction costs are significantly higher in the United States than in Asia, where Micron operates all but two of its 11 factories.
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©2025 Advance Local Media LLC. Visit syracuse.com. Distributed by Tribune Content Agency LLC.
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Tags: investment tax credit, Legislation, Micron, obbba, tax credit, Taxes
