Wednesday, 09 May 2018 05:12

AIIA concerned R&D Tax Incentive changes will hit innovation Featured

By

The Australian Information Industry Association has expressed concerns over changes to the R&D Tax Incentive in the Federal Budget, saying that they could put the brakes on innovation by discouraging companies from local investment.

AIIA chief executive Rob Fitzpatrick said “This risks Australia taking a step back in our global competitiveness.

“Australia is in the midst of an R&D recession with a $2.2 billion decline in investment, according to the latest data. While some elements of the 3F review now being implemented are better than those considered earlier, the rhetoric focuses on ‘crackdown’ rather than expansion and growth. Australia’s global competitiveness is reliant on a buoyant R&D mindset.”

But he applauded the focus on digital transformation incentives in various industries such as health, agriculture and manufacturing, saying the AIIA welcomed investments in developing the space industry, and in supporting national research infrastructure and similar initiatives

Prior to the Budget, the AIIA had expressed the fear that changes to the $3 billion R&D Tax Incentive and restricting claims for software R&D would result in companies looking to move offshore.

Fitzpatrick said a key area of concern around the R&D Tax Incentive was intensity testing.

“While this measure is not as severe as initially proposed, we need to encourage both broad and deep investment in R&D across all technology-related industries,” he said.

From 1 July, the government will target the tax incentive towards larger R&D projects – with concessional rebates up to $150 million for companies with turnover of $20 million or more.

For companies with annual turnover below $20 million, the government will impose a cap of $4 million on cash refunds and convert the rate of the R&D tax offsets to a premium of 13.5% above a claimant’s company tax rate.

Administrative and compliance improvements that will assist with ongoing sustainability, transparency and integrity of the tax incentive will also be implemented.

Fitzpatrick said: "While these measures will ensure the R&D Tax Incentive is fiscally affordable, we need to ask whether the financial benefits will constrain Australia’s global competitiveness.”

The AIIA looked forward to working closely with the government to achieve a stronger, fairer, and digitally enabled economy, he added.

“We are heartened to see such strong investment in the data economy and particularly in government digitisation, innovation and education. This funding will ensure that we continue to drive effective innovation across the Australian economy.”

Sam Allert, ANZ managing director of accounting software provider Reckon, said he was disappointed with the changes in the R&D Tax Incentive.

“It’s disappointing to see that the government has decided to restructure the R&D Tax Incentive," he said. "This will have huge implications on many Australian small businesses that rely heavily on the tax concession to drive research, development and innovation, as well as start-ups who do not have the capacity to work on projects with a substantial R&D spend above industry peers.

“Along with these changes, the ATO will now be able to publicly disclose those who requested R&D relief and what the relief was for, as well as impose a limit on time extensions to complete R&D registrations and amendments to technical provisions.

"These changes could jeopardise Australia’s goal of becoming the region’s innovation hub, as more businesses are forced to set up their R&D bases in countries with more supportive government initiatives and funding.”


Subscribe to ITWIRE UPDATE Newsletter here

Now’s the Time for 400G Migration

The optical fibre community is anxiously awaiting the benefits that 400G capacity per wavelength will bring to existing and future fibre optic networks.

Nearly every business wants to leverage the latest in digital offerings to remain competitive in their respective markets and to provide support for fast and ever-increasing demands for data capacity. 400G is the answer.

Initial challenges are associated with supporting such project and upgrades to fulfil the promise of higher-capacity transport.

The foundation of optical networking infrastructure includes coherent optical transceivers and digital signal processing (DSP), mux/demux, ROADM, and optical amplifiers, all of which must be able to support 400G capacity.

With today’s proprietary power-hungry and high cost transceivers and DSP, how is migration to 400G networks going to be a viable option?

PacketLight's next-generation standardised solutions may be the answer. Click below to read the full article.

CLICK HERE!

WEBINAR PROMOTION ON ITWIRE: It's all about webinars

These days our customers Advertising & Marketing campaigns are mainly focussed on webinars.

If you wish to promote a Webinar we recommend at least a 2 week campaign prior to your event.

The iTWire campaign will include extensive adverts on our News Site itwire.com and prominent Newsletter promotion https://www.itwire.com/itwire-update.html and Promotional News & Editorial.

This coupled with the new capabilities 5G brings opens up huge opportunities for both network operators and enterprise organisations.

We have a Webinar Business Booster Pack and other supportive programs.

We look forward to discussing your campaign goals with you.

MORE INFO HERE!

BACK TO HOME PAGE
Sam Varghese

website statistics

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

Share News tips for the iTWire Journalists? Your tip will be anonymous

WEBINARS ONLINE & ON-DEMAND

GUEST ARTICLES

VENDOR NEWS

Guest Opinion

Guest Interviews

Guest Reviews

Guest Research

Guest Research & Case Studies

Channel News

Comments