The Australian government should double the R&D tax offset threshold to at least $2 million and simplify the application process for the offsets, the Australian Computer Society (ACS) has said.
The demands are a part of the ACS’s submission to the government’s National Innovation Review, which also included a call for the government to bring Australia’s innovation incentives into line with other countries’.
“Compared to other OECD countries, Australia has not been successful at commercialising and marketing its ICT innovations at the national or international level,” ACS president Kumar Parakala said.
Parakala pointed specifically to tax concessions for R&D, which have been decreased in recent years in Australia. In contrast, other countries have seen their concessions increase.
“We need to look at other small countries like Finland, Sweden, Singapore, Switzerland and Malaysia who have established a strong ICT presence in the global market and use this as a point of reference on which to model our future ICT innovation directions here in Australia.”
The ACS’s submission to the Innovation Review comprised 12 suggestions:
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Examine the innovation system model put forward in 'National Innovation Systems: Finland, Sweden & Australia Compared' by the Australian Business Foundation.
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Benchmark the Australian innovation system and incentives and compare them to countries with strong innovation systems.
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Recognise ICT innovation as a national priority, and that government-funded commercial research and innovation should be assessed on the basis of agreed commercial metrics — not traditional research-based metrics.
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Recognise the pervasive nature of ICT and consider it a discrete priority area in its own right.
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Implement government purchasing practices and policies that allow for piloting of new innovation to help mitigate the risks of new solutions.
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Develop a regulatory framework for government procurement across all jurisdictions.
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Only take what intellectual property (IP) from solution providers is necessary to support business; IP should not be automatically acquired by government agencies.
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Remove the requirement stipulating that software development must be produced for multiple sales or licences in order to be eligible for R&D tax concession.
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Make the development of in-house software eligible for tax concessions.
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Relax the requirements of Section 73B(9) of the Tax Assessment Act restricting the R&D tax concessions to firms that have control over the R&D projects and effectively own the project results.
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Simply the application process for tax concessions.
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Increase the tax offset threshold of $1 million significantly, to at least $2 million.
The ACS’s complete submission to the Innovation Review can be found here: http://www.acs.org.au/attachments/InnovationSubmission.pdf.
