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Treasury criticised R&D tax credit, Govt should lower corporate rate

By   /  April 19, 2018  /  Comments Off on Treasury criticised R&D tax credit, Govt should lower corporate rate

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Source: ACT Party

Headline: Treasury criticised R&D tax credit, Govt should lower corporate rate




In 2008, the Government’s economic advisor set out various concerns about an R&D tax credit.

“Grant Roberston should listen to these concerns and instead lower the corporate tax rate for all businesses”, says ACT Leader David Seymour.

“The Treasury said the estimated fiscal cost of maintaining the credit [would be] $373 million a year and that it incurred significant fiscal and compliance costs for businesses.

“It also questioned the credit’s effectiveness, saying that international experience and anecdotal evidence showed little additional expenditure will be generated as a result of the credit.

“This is because firms can claim credits for pre-existing R&D investment plans and may recharacterise their expenditure to fit the eligibility criteria.

“The Government would do far better to cut taxes across the board and let businesses make their own investment decisions.

“Greater investment in research and development is important, but this isn’t the way to do it.

“The Government should lower the corporate tax rate for all businesses, encouraging greater investment and growth, more jobs and higher wages for workers”, says Mr Seymour.

MIL OSI

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