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R&D concessions popular with business.



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28 May 2004 04/144

R&D CONCESSIONS POPULAR WITH BUSINESS

New figures show that more than 1600 companies registered for the 125% R&D Tax Offset and just under 500 registered for the 175% Premium R&D Tax Concession in 2001-02.

Federal Industry Minister, Ian Macfarlane, released the figures today while visiting Brisbane company Micreo Ltd, a small electronic components manufacturer, which claims the R&D Tax Offset.

“This uptake translates to $480 million, spent on research and development through the Tax Offset scheme, and an additional $291 million flowing from the 175% Premium R&D Tax Concession,” said Mr Macfarlane.

The Tax Offset is designed to assist innovative, small companies who cannot gain immediate benefit from the R&D Tax Concession.

“The take-up of the Tax Offset indicates that the measures are highly effective in assisting smaller companies in their R&D efforts. Smaller firms with a turnover of under $500,000 and firms with up to 5 employees were the highest users of the Tax Offset,” Mr Macfarlane said.

The 175% Premium provides a higher level of support to companies who conduct additional R&D above the previous three-year average expenditure on R&D.

Overall, business investment in R&D increased in 2001-02 by 13% in nominal terms to $5.5 billion.

“It is very encouraging to see that these initiatives are clearly providing such a boost for R&D in this country and I’m gratified that the Government’s new Backing Australia’s Ability - Building Our Future through Science and Innovation, extends funding for these measures”, Mr Macfarlane said.

Department Contact: Karen Kuschert (02) 6213 6389

CMR04-154