Proposed reforms announced today by the Labor Party aimed at strengthening Australia’sworld-class R&D tax incentive program could play a vitally important role in growing productivity and creating new employment opportunities into the future, according to the Australian Investment Council.
“The Labor Party’s plan to improve incentives for collaboration between the university sector and business to drive innovation is a very important step in the right direction for Australia’s future,” said Australian Investment Council chief executive, Yasser El-Ansary.
“There is clearly an opportunity for Australian businesses to do much more to engage with universitiesin supporting the commercialisation of research.”“When greater levels of collaboration occur, there are significant economic dividends that come from unlocking global commercialisation opportunities stemming from some of the ground-breaking research that is undertaken within our publicly-funded research organisations,” he added.
“Australia’s R&D tax incentive program is recognised as being amongst the world’s best, and it’s vitally important that we protect the integrity of the program, while seeking to drive greater levels of investment and reinvestment into commercialisation of our best research discoveries.”
“The most important policy framework supporting Australia’s innovation sector is the R&D program. Over recent years there has been too much uncertainty created in this area as a result of moves to tighten access to the program, along with a significant lift in the level of Tax Office audit activity,”according to Mr El-Ansary.
In the Australian Investment Council’s recently released policy blueprint, Investing for Growth: Policy Proposals for the incoming Federal Government, we called on all sides of politics to support instilling a greater level of certainty around the future of the highly successful R&D program.
“Australia has a productivity and competitiveness challenge that we must work hard to tackle in everyindustry sector of the economy, and one guaranteed strategy to help us lift our economic performance is to encourage greater investment into R&D.
The R&D program is the foundation upon which that activity is built,” said Mr El-Ansary.
According to the Australian Investment Council, the Labor Party should take a further step forward in relation to the R&D program, and confirm they will not proceed with the implementation of changesthat would impose new restrictions on access to the refundable R&D program for Australia’s growingearly stage venture sector.
The changes were to be introduced by the Coaliition Government as part of the last term of the Parliament, and would see the adoption of a new $4m annual cap on refundable credits for businesses with a turnover below $20m per annum.