Efficiency Gains through Grading Standards And Viable Enhancement Act of 2025; EGG SAVE Act of 2025
Summary
The EGG SAVE Act of 2025 proposes a tax credit for commercial egg hatchery facilities that invest in layer operation efficiency equipment, specifically in-ovo sex identification technology. The credit would be available for equipment placed in service between 2026 and 2028, with the percentage decreasing each year. This aims to incentivize the adoption of technologies that determine the sex of avian embryos before they hatch, potentially reducing the practice of culling male chicks.
The tax credit is structured to be 50% in 2026, 40% in 2027, and 30% in 2028 of qualified equipment expenditures. Qualified expenditures include the purchase, installation, and necessary facility modifications for the equipment. The bill also includes provisions for recapture of the credit if the equipment ceases to be eligible and reduces the basis of the property by the amount of the credit.
This bill amends the Internal Revenue Code of 1986 and integrates the new credit into the general business credit under Section 38. The legislation is set to take effect for property placed in service after December 31, 2025.
Expected Effects
The EGG SAVE Act is likely to encourage commercial egg hatcheries to invest in in-ovo sex identification technology. This could lead to a reduction in the number of male chicks culled, aligning with animal welfare concerns.
Economically, the act could stimulate growth in the manufacturing and installation of the qualified equipment. The tax credit would reduce the financial burden on egg producers adopting these technologies.
Potential Benefits
- Incentivizes adoption of technology that reduces the culling of male chicks, addressing ethical concerns.
- Provides tax relief to commercial egg hatcheries, potentially improving their financial stability.
- Stimulates economic activity in the manufacturing and installation of specialized equipment.
- May lead to more efficient egg production processes.
- Could improve the public image of the egg industry by addressing animal welfare issues.
Potential Disadvantages
- Potential for increased tax burden on other sectors to offset the tax credit.
- Complexity in defining and verifying "qualified equipment expenditures" could lead to administrative challenges.
- The limited timeframe (2026-2028) may not be sufficient for all hatcheries to adopt the technology.
- Possible unintended consequences if the technology does not perform as expected or becomes obsolete quickly.
- The cost of the equipment and facility modifications, even with the tax credit, may still be prohibitive for smaller hatcheries.
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution (Preamble), as it aims to promote ethical practices and support the agricultural sector. Article I, Section 8 grants Congress the power to lay and collect taxes, duties, imposts, and excises to pay the debts and provide for the common defense and general welfare of the United States. This bill falls under that power, as it provides a tax credit to incentivize certain business practices.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).