Post by : Badri Ariffin

OpenAI is urging the Trump administration to broaden tax incentives aimed at invigorating the burgeoning AI sector. In a letter directed to the White House Office of Science and Technology Policy, the AI leader proposed extending a 35% tax credit originally meant for semiconductor manufacturing to encompass AI data centers, server production, and essential components of the electrical grid.

The organization pushes for these tax credits to reduce investment risks, stimulate private capital infusion, and hasten the establishment of AI infrastructure nationwide. OpenAI has already pledged a staggering $1.4 trillion for the advancement of sophisticated AI systems, including extensive data centers and specialized chips, raising questions about the financing behind these major initiatives.

Moreover, OpenAI’s recommendations include offering grants, joint financing options, and loans aimed at manufacturers within the AI sector, especially for parts where international competition, primarily from China, impacts pricing. Specific components like transformers and electrical steel were cited as critical areas where governmental support could alleviate constraints.

Earlier this year, CFO Sarah Friar hinted at a possible governmental role in assisting OpenAI's infrastructure financing, a statement that was later clarified as a misunderstanding but ignited discussions regarding federal support. The Trump administration has firmly rejected any notion of direct financial bailouts, with OpenAI emphasizing that their focus is on industry-wide assistance rather than rescuing individual entities.

This letter aligns with ongoing initiatives to bolster US chip production under the 2022 Chips Act, where only a small portion of the designated funding has been utilized, highlighting opportunities for additional strategies to strengthen local AI supply chains. By broadening tax incentives and implementing other financial mechanisms, OpenAI believes the US can retain its competitive stance in the global AI landscape.

#Global News #Tech News #AI