AusBiotech concern over $2m R&D tax cap

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AusBiotech has expressed concern over some recommendations contained in the review of the R&D Tax Incentive.

The review was released yesterday. It contains a raft of recommendations the expert panel says are designed to promote 'additionality' and 'spillovers'.

According to AusBiotech CEO, Mr Glenn Cross, the biotechnology sector has a mixed response to the review.

“There is strong objection to the recommendation of  a $2 million cap on the refundable component of the programme that would disadvantage a significant portion of the SMEs in the sector, and support for improved guidance and extending the $100 million claim cap for the non-refundable offset,” he said.  

The review panel said they recommended the change in part to ensure financial sustainability, a point Mr Cross disputes.

“Concern remains over the overstating of the cost of the program, which appears to be the justification driving the narrative for change,” he said.

He continued, “The R&D Tax Incentive is the most critical centre-piece program in the translation of Australia’s world-class research into treatments, cures, diagnostics devices and vaccines. It is important that the Government not diminish the programme with unnecessary complexity, conditions and carve outs, and instead provide consistency and certainty to the life sciences sector to allow its development.

“The R&D Tax Incentive has been the shining beacon of encouragement and support to the industry and plays a pivotal role in motivating and attracting research, development and clinical trials to be conducted in Australia as well as local investment.

“The notion of a research intensity measure is of interest.”

Mr Cross said AusBiotech would review the report and its recommendations in detail, including consulting its members.

“Innovation will be the next boom for Australia and the biotechnology and medical technology combined sector has the potential to be a major economic driver for Australia, delivering new technologies and also in providing quality jobs in science, technology, engineering and maths (STEM) fields, exports and more clinical trials for patients to access,” he added.