The Australian government presented it budget to parliament on Tuesday evening. It is a big-spending budget intended to cushion the impact of the global recession and to stimulate the economy.
The news for those engaged in research and development and innovation is positive, with some key funding initiatives including:
– The creation of a Commonwealth Commercialisation Institute.
– A new Sustainable Research Excellence in Universities initiative.
– A new tax credit scheme as follows:
- From 2010-11 a 45 per cent refundable tax credit (equivalent to a 150 per cent concession) will be provided to small firms with a turnover of less than $20 million per annum.
- The refundable credit is available to firms in tax loss, providing a significant benefit to high-tech start-up companies in areas such as biotechnology and ICT.
- A 40 per cent tax credit (equivalent to a 133 per cent concession) will be open to foreign-owned firms, and firms with a turnover of $20 million or more per annum.
- The R&D Tax Credit is decoupled from the corporate tax rate and thereby creates certainty in the level of assistance.
- The complex R&D Tax Concession Premium and International Premium will be abolished and definitions of eligible R&D tightened to provide better targeted support.
- As a transitional measure prior to the introduction of the R&D Tax Credit, the R&D expenditure threshold for the R&D Tax Offset will increase from $1 million to $2 million for 2009-10.