In a move to boost domestic consumption and support local manufacturers, Representatives Ro Khanna of California and Debbie Dingell of Michigan, both Democrats, introduced a bill aimed at encouraging Americans to shop from small businesses in the U.S.
The proposed legislation, disclosed during a tour of manufacturing facilities in Ann Arbor, Michigan, offers financial incentives for consumers choosing American-made products.
The Made in the USA Tax Credit Act, as it's known, seeks to revitalize American manufacturing by providing up to $2,500 in tax credits to individuals and $5,000 for couples purchasing goods that meet the Federal Trade Commission's (FTC) Made in the USA standards, which require that a product must be "all or virtually all" made in the U.S., according to the FTC's website.
Exclusively targeting products from small businesses defined by the Small Business Administration as having fewer than 500 employees, the bill excludes luxury items, tobacco, firearms and vehicles, aiming to make American goods more affordable while fostering job creation and worker dignity.
"Investing in American manufacturing drives innovation, prosperity, and progress," Dingell said in a press release last week. "I'm proud to introduce the Made in the USA bill with Rep. Khanna to encourage consumers to support the family-owned small businesses here in our communities, and to look to American products first."
Through the bill, Khanna and Dingell aim to address an issue that has been undermining the core of American economic strength and community vitality.
Since 1998, the decline in American manufacturing, coupled with an increase in imports, has resulted in the closure of more than 70,000 factories, Dingell said in the release. The trend has led to the loss of jobs and has "hollowed out" entire communities and regions that once thrived on the back of manufacturing, hurting the economy and dimming the luster of the American dream for many, Dingell said.
In a targeted approach to support the broader base of consumers, the bill sets eligibility standards for individuals and couples. Individuals (excluding dependents) are eligible if they earn less than $125,000 per year and have investment income below $20,000. Couples filing jointly are eligible if they earn less than $250,000 per year and have investment income less than $40,000. To ensure the credit keeps pace with economic changes, its maximum amount will adjust with inflation each year.
"I am proud to be introducing the Made in the USA bill with Representative Dingell," Khanna said in the release. "This bill will make items more affordable for consumers and help support American businesses and workers. It's an important piece of what needs to be a sweeping set of policy actions designed to restore American manufacturing and technology leadership and a call to respect workers who will help our country achieve that goal."
Introduced to the House Committee on Ways and Means, the bill must navigate through the House, the Senate and ultimately receive President Joe Biden's approval to become law.
Newsweek has reached out to the offices of Dingell and Khanna by email on Tuesday morning for comment.
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