Reporting progress on the Government’s plan to introduce a research and development (R&D) tax incentive, Research, Science and Innovation Minister Megan Woods reiterates the aim to lift New Zealand’s economy-wide spend on R&D from 1.3% to 2% of GDP over the next 10 years. The tax incentive will be a key lever in reaching this goal.
After a consultation period, officials are now producing final recommendations on the design of the scheme.
There will be further opportunities for people to have their say on the design of the R&D tax incentive during the select committee process later this year.
Legislation will be introduced in October for the R&D tax incentive to be in place by 1 April 2019. Eligible businesses paying tax will be able to benefit from this policy from day one.
Over time, the Government intends to have a full package of support for New Zealand’s Innovation system, including support for start-ups.
“We recognise it is vital to have the right kinds of support in place for pre-profit businesses that are in tax loss or those that have insufficient taxable income to benefit from a tax credit,” Dr Woods said.
She has noted concerns that R&D-intensive firms and start-ups would not be able to benefit from the incentive.
The policy issues involved in supporting companies in tax loss through a tax incentive were complex, she said, “but we are committed to having a solution in place by April 2020”.
In the meantime start-ups and businesses in tax loss can continue to get support from the range of grants and incubators from Callaghan Innovation.
Source: Minister for Research, Science and Innovation