HR6055-119

1. Short title This Act may be cited as the Strengthening Essential Manufacturing and Industrial Investment Act or the SEMI Investment Act.

2. Expansion and extension of advanced manufacturing investment credit Paragraph (3) of section 48D(b) of the Internal Revenue Code of 1986 is amended to read as follows: For purposes of this section, the term advanced manufacturing facility means a facility for which the primary purpose is the manufacturing of— semiconductors, semiconductor manufacturing equipment, or semiconductor materials. For purposes of this paragraph, the term semiconductor materials means— any direct production material, or any indirect production material, For purposes of this subparagraph, the term direct production material means a material which is— primarily used for, and integral to, the production of a semiconductor, physically incorporated into a finished semiconductor, and any of the following: Any substrate of silicon, silicon carbide, gallium nitride, gallium arsenide, indium phosphide, or other semiconductor-grade substrate material. Any deposited metal, dielectric, barrier material, or dopant that forms the physical structure of a semiconductor. Any ceramic, organic, or metallic material that forms the physical base for semiconductor packaging. Any wire bond, solder bump, lead frame, die attach adhesive, underfill, or other material which— forms electrical connections within a semiconductor, or provides structural integrity within a semiconductor. For purposes of this subparagraph, the term indirect production material means a material which is— a specialized material that is primarily used for, and integral to, the production, testing, inspection, or packaging of a semiconductor, not physically incorporated into a finished semiconductor, and any of the following: An etchant, deposition precursor, doping gas, or other chemical used in wafer fabrication. A photoresist, photoresist ancillary material, developer, mask, or pellicle used in semiconductor patterning. A solvent, surfactant, slurry, Chemical Mechanical Planarization (CMP) pad, conditioning disk, or cleaning agent used to prepare and maintain semiconductor manufacturing surfaces. A probe card, test socket, or optical inspection material. A mold compound, encapsulant, or bonding wire used in assembly processes. A polymer, elastomer, ceramic material and resultant tubings, fittings, vessels, filters, seals, or other such chemical-handling or wafer-handling material. Any process chamber materials used in production that play an active role in energy transmission, heat dissipation, plasma resistance, or chemical resistance. Any other material identified by the Secretary pursuant to subclause (II). For purposes of item (cc)(HH) of subclause (I), the Secretary (in consultation with the Secretary of Commerce) shall identify additional materials which are described in items (aa) and (bb) of such subclause. The term indirect production material shall not include any material which— has a generic use, and is predominately used in an application other than semiconductor manufacturing. Not later than 180 days after the date of enactment of the Strengthening Essential Manufacturing and Industrial Investment Act, and annually thereafter, the Secretary, in consultation with the Secretary of Commerce, shall publish a list that sets forth the specifications, characteristics, and applications of materials that qualify as direct production materials and indirect production materials for purposes of clauses (ii) and (iii). In the case of any material which has not been included on the most recent list under subclause (I), a taxpayer may file a petition (at such time, and in such form and manner, as the Secretary may prescribe) with the Secretary for a determination of whether such material qualifies as a direct production material or indirect production material for purposes of clauses (ii) and (iii). Section 48D(e) of such Code is amended by striking December 31, 2026 and inserting December 31, 2031. Except as otherwise provided in this subsection, the amendments made by this section shall apply to property placed in service after the date of the enactment of this Act. The amendment made by subsection (b) shall apply to property, the construction of which begins after December 31, 2026. (3)Advanced manufacturing facility (A)In generalFor purposes of this section, the term advanced manufacturing facility means a facility for which the primary purpose is the manufacturing of— (i)semiconductors, (ii)semiconductor manufacturing equipment, or (iii)semiconductor materials. (B)Semiconductor materials (i)In generalFor purposes of this paragraph, the term semiconductor materials means— (I)any direct production material, or (II)any indirect production material,which is used in semiconductor manufacturing (as defined in section 231.116 of title 15, Code of Federal Regulations). (ii)Direct production materialFor purposes of this subparagraph, the term direct production material means a material which is— (I)primarily used for, and integral to, the production of a semiconductor, (II)physically incorporated into a finished semiconductor, and (III)any of the following: (aa)SubstrateAny substrate of silicon, silicon carbide, gallium nitride, gallium arsenide, indium phosphide, or other semiconductor-grade substrate material. (bb)Thin film or layering materialAny deposited metal, dielectric, barrier material, or dopant that forms the physical structure of a semiconductor. (cc)Packaging substrate materialAny ceramic, organic, or metallic material that forms the physical base for semiconductor packaging. (dd)Bonding, interconnect, or adhesive materialAny wire bond, solder bump, lead frame, die attach adhesive, underfill, or other material which— (AA)forms electrical connections within a semiconductor, or (BB)provides structural integrity within a semiconductor. (iii)Indirect production material (I)In generalFor purposes of this subparagraph, the term indirect production material means a material which is— (aa)a specialized material that is primarily used for, and integral to, the production, testing, inspection, or packaging of a semiconductor, (bb)not physically incorporated into a finished semiconductor, and (cc)any of the following: (AA)Process chemicalsAn etchant, deposition precursor, doping gas, or other chemical used in wafer fabrication. (BB)Photolithography materialA photoresist, photoresist ancillary material, developer, mask, or pellicle used in semiconductor patterning. (CC)Cleaning, planarization, and preparation materialA solvent, surfactant, slurry, Chemical Mechanical Planarization (CMP) pad, conditioning disk, or cleaning agent used to prepare and maintain semiconductor manufacturing surfaces. (DD)Testing and inspection materialA probe card, test socket, or optical inspection material. (EE)Packaging process materialA mold compound, encapsulant, or bonding wire used in assembly processes. (FF)Fluid-, gas-, or wafer-handling materialA polymer, elastomer, ceramic material and resultant tubings, fittings, vessels, filters, seals, or other such chemical-handling or wafer-handling material. (GG)Wafer processing chamber materialsAny process chamber materials used in production that play an active role in energy transmission, heat dissipation, plasma resistance, or chemical resistance. (HH)Other materialAny other material identified by the Secretary pursuant to subclause (II). (II)Other indirect production materialsFor purposes of item (cc)(HH) of subclause (I), the Secretary (in consultation with the Secretary of Commerce) shall identify additional materials which are described in items (aa) and (bb) of such subclause. (III)ExclusionThe term indirect production material shall not include any material which— (aa)has a generic use, and (bb)is predominately used in an application other than semiconductor manufacturing. (iv)List of semiconductor materials (I)In generalNot later than 180 days after the date of enactment of the Strengthening Essential Manufacturing and Industrial Investment Act, and annually thereafter, the Secretary, in consultation with the Secretary of Commerce, shall publish a list that sets forth the specifications, characteristics, and applications of materials that qualify as direct production materials and indirect production materials for purposes of clauses (ii) and (iii). (II)Petition for interim determinationIn the case of any material which has not been included on the most recent list under subclause (I), a taxpayer may file a petition (at such time, and in such form and manner, as the Secretary may prescribe) with the Secretary for a determination of whether such material qualifies as a direct production material or indirect production material for purposes of clauses (ii) and (iii)..