The Australian Industry Group has told a Senator Economics Committee Hearing in Canberra that proposed new R&D Tax credit laws are “deeply flawed.”
Mr Innes Willox, Ai Group Director of International and Government Relations, said if implemented the legislation would significantly reduce the innovation efforts of Australian industry.
“The feedback from our members indicates very little support for the proposals in core economic growth industries such as mining, manufacturing and construction,” Mr Willox said.
Mr Willox said Australia continues to lag behind the OECD average on business expenditure on research and development.
“Our view is that the Government's proposed R&D scheme will undermine this trend and, more likely, put the county's business R&D effort into reverse.”
Dr Peter Burn, Ai Group director of Public Policy told the committee: “We very firmly oppose the fundamentally new approach to defining business R&D expenditure that is embodied in the legislation before the Committee.
“It is embodied in the objects clause, the changed definitions of eligible expenditure and the restrictions relating to the treatment of core and supporting expenditure.
“Our opposition has three elements: the timetable the Government has imposed; the restrictive nature of the definition of eligible business R&D expenditure and the heavy compliance requirements that we anticipate would arise from the structure of the new approach.”