The Semiconductor Industry Association (SIA) is applauding the U.S. House of Representative’s introduction of the bipartisan Semiconductor Technology Advancement and Research (STAR) Act which extends Section 48D of the CHIPS and Science Act, or the Advanced Manufacturing Investment Credit (AMIC). According to the SIA Press Release, AMIC gives an eligible taxpayer a tax credit of up to 25% of a qualified investment in an advanced manufacturing facility for semiconductors and semiconductor manufacturing equipment, but it expires by 2026. However, the STAR Act extends this and expands it to also include investments in semiconductor design.
“The CHIPS Act’s investment tax credit has been hugely successful in strengthening America’s semiconductor ecosystem, spurring substantial private investment and helping to put the U.S. on track to more than triple domestic chip manufacturing capacity by 2032, the largest percentage increase in the world. By extending the duration of the credit, the STAR Act would build on this moment by promoting further growth in chip manufacturing here in the United States,” the SIA said in its statement. It also added, “By expanding coverage of the credit to include chip design, the STAR Act would ensure the U.S. secures the economic, national security, and first-mover advantages of being the global leader in semiconductor technology.”
This CHIPS and Science Act is credited for reviving America’s semiconductor industry, with the country spending more on chip manufacturing in 2024 than in the past 28 years combined. However, it was also criticized for not going far enough in chip research and development—for example, Applied Materials was denied a $4-billion grant for its proposed R&D center in Sunnyvale, California. The STAR Act, if approved, would help remedy this, allowing research-intensive chip designs like Arm, AMD, and Nvidia do to be covered by federal investments.
There has been some uncertainty in the past weeks, especially with President Trump criticizing the CHIPS and Science Act during his second campaign. This led to several chipmakers racing for federal funding before his January inauguration. However, it seems that the Trump administration will back at least some of the previous government’s semiconductor investment strategy, giving American chipmakers some hope that they can still continue their expansion plans. Aside from that, the STAR Act’s bipartisan endorsement signals broader support for additional expansion of the U.S.’s investments in semiconductors.
The former U.S. Commerce Secretary, Gina Raimondo, has called for CHIPS Act 2, saying that American chip makers need funds to build more fabs. So, if the STAR Act passes through Congress and the Senate and gets signed into law, it gives hope for a second CHIPS and Science Act-like that will further expand American investment into semiconductors.
