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Australia Urged To Push Through R&D Tax Reforms

by Mary Swire,, Hong Kong

22 November 2013

Australia's new Coalition Government has been urged to "deliver on its pro-business rhetoric" and pass the pending Research and Development Tax Incentive quarterly payments legislation.

AusBiotech has warned against the further delay of this "much-anticipated measure." Treasurer Jo Hockey, as part of his plan for dealing with a backlog of unlegislated tax reforms, has categorized the Tax Incentive as requiring "further consultation."

Ex-Treasurer Wayne Swan released an exposure draft, together with explanatory memoranda and costings, in May. Quarterly payments were to form an opt-in element of the Tax Incentive for companies with an aggregated turnover of less than AUD20m (USD18.8m). Companies eligible for the R&D refundable tax offset would have been able to obtain the offset on a quarterly basis during an income year, rather than waiting until an income tax return is assessed.

However, parliament was subsequently dissolved, and AusBiotec is concerned that the legislation's progression and planned implementation date have been left uncertain.

Dr Anna Lavelle, CEO of AusBiotech, said: "We applaud the Coalition's explicit pro-investment remarks that Australia is 'open for business' and AusBiotech urges the Government to continue with much-needed tax reform and deliver this pro-business measure to support young innovative, home-grown companies that are commercializing our health and medical research."

"The quarterly payments have been carefully reviewed, planned, consulted upon and costed by Government with industry. To lose the payments now would be a further blow to small start-up innovative companies that have been struggling in the post-GFC and 'unfriendly' business environment."

AusBiotech is also calling on the Government to introduce the Australian Innovation & Manufacturing (AIM) Incentive, which will offer a patent box style incentive for keeping intellectual property and the related manufacturing in Australia, once it reaches commercialization.

TAGS: tax | investment | business | tax incentives | intellectual property | Australia | manufacturing | legislation | tax planning | tax reform | trade association | trade

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