Next steps on the R&D tax incentiveHon Dr Megan Woods Research, Science and Innovation
Kia ora and welcome to another update on the Research and Development Tax Incentive.
First of all, I would like to thank everyone who got involved in the consultation progress. Your feedback on how to make the R&D Tax Incentive work better was incredibly valuable. We are confident that we will have a scheme in place that will support more New Zealand firms increase their R&D.
What we did
We made a number of changes after listening to your feedback, such as lifting the credit rate to 15 percent, and lowering the minimum expenditure threshold to $50,000. We also amended the definition of R&D so that eligibility could be accessed more easily across all sectors.
All the policy details, including submissions and official papers, are available on MBIE’s website.
On the Growth Grant front, we have extended contracts until 31 March 2021. If you are a current Growth Grant holder, Callaghan Innovation will continue to support your transition to the tax incentive over this time.
Legislation to enact the R&D Tax Incentive is now going through Parliament.
I encourage you to get involved in the select committee process so we can really hone in on the technical details. You can read the Bill in its current form and make a submission to the Finance and Expenditure Committee on Parliament’s website. You can also read a commentary of the Bill, which clarifies some of the more technical aspects of the Tax Incentive, on Inland Revenue’s website.
We are also beginning ‘phase two’ of the consultation process, where we’ll address issues such as refundability, and refine, extend and simplify the reach and usability of the Tax Incentive.
It’s important to remember that the R&D tax incentive will be one form of support amongst many for supporting business innovation.
One of my priorities as Minister for Research, Science and Innovation is to have a full package of support for New Zealand’s Innovation system, including more support for start-ups in the near future.
Again I would like to thank all those businesses that engaged in the consultation process to produce a user-friendly, fit-for-purpose scheme to boost New Zealand’s R&D and build a more innovative economy.
I look forward to engaging with you further over the coming months.