R&D tax incentive discussion document released
Today Research, Science and Innovation Minister Megan Woods and Revenue Minister Stuart Nash released the Research and Development Tax Incentive Discussion Document for public consultation.
“This Government is committed through our coalition agreement with New Zealand First to increasing business R&D expenditure to two per cent of GDP over ten years, and this consultation document is the first step we will take together in achieving this ambitious goal,” says Ms Woods.
“Currently New Zealand’s gross expenditure on R&D is 1.28 per cent of GDP – much lower than the OECD average of 2.38 per cent. We need new ideas, new innovations and new ways of looking at the world if we are to build a sustainable and productive economy that delivers for all New Zealanders.
“Growing R&D is a key lever in diversifying the economy and creating new industries, businesses, and highly skilled jobs. Sustained increases in government investment will be important, but we will also need to see an increasing contribution from the private sector, specifically in businesses undertaking R&D.
“That’s why we’re introducing an R&D tax incentive as a significant addition to the system of government support for New Zealand’s innovation system,” says Ms Woods.
Revenue Minister Stuart Nash says the R&D tax incentive will have broad reach across the economy, and will enable businesses of all sizes to undertake R&D.
“An R&D tax incentive will offer a greater element of certainty to businesses. It will be a simpler process, and will open access to those that have either struggled to access support or have been shut out of the process in the past. The system should stand the test of time and give businesses the consistency and confidence they need to succeed.
“There needs to be a careful approach to establishing a tax incentive mechanism of this nature. The discussion document sets out the main design and technical features proposed for the R&D tax incentive,” says Mr Nash.
Over the next six weeks, the Ministry of Business, Innovation and Employment, with support from Inland Revenue and Callaghan Innovation, will be actively seeking feedback on specific aspects of this proposal to ensure the R&D tax incentive is fit for purpose.
Visit MBIE’s website to read the R&D tax incentive discussion document and to make a submission here