Fashion businesses eager to add their two cents on the Government's new R&D Tax Credit scheme have been offered the opportunity to speak out.
Keen to appeal to small and medium-sized businesses, the Gillard Labor Government has put out a call for the public to have their say on how the new Research & Development Tax Credit scheme will be administered.
Interested businesses, including those across the Textile, Clothing and Footwear (TCF) sector, will have until August 5, 2011 to file their submissions via a consultation document available at www.innovation.gov.au/RDTaxCreditRegulations.
The new R&D Tax Credit scheme, created in an effort to increase research and innovation in Australia, aims to give small and medium-sized businesses greater access to their funds for R&D, in order to assist in creating the new jobs, skills and technologies they need to thrive in a competitive and low-carbon economy.
It is expected that the new R&D tax incentive will replace the existing R&D Tax Concession with two core components: a 45 per cent refundable R&D tax offset for eligible entities with a turnover of less than $20 million; and a non-refundable 40 per cent R&D tax offset for all other eligible entities.
Rather than the 7.5 cents in the dollar secured through the R&D Tax Concession Scheme, this new program would allow for 15 cents in the dollar for eligible projects for companies with under a $20 million turnover, providing more opportunities for small businesses to invest in research and development.
Calling for comment on the R&D Tax Credit’s detailed administrative arrangements, Innovation Minister Senator Kim Carr said the new R&D Tax Credit was vital for Australian businesses and the national economy.
“The R&D Tax Credit will encourage a surge of improved materials, products, processes and services, leading to greater prosperity and more high-wage, high-skill jobs for Australians,” he said.
“This is because small and medium-sized businesses — whose R&D efforts are generally constrained by cash flow — will have better access to the Tax Credit than they have had with the R&D Tax Concession. By making the R&D incentive more attractive to small and medium-sized businesses the Government’s tax incentives will be distributed more fairly than has been the case under the current R&D Tax Concession. This will herald a new era of innovation, design and production.”
In a recent statement, TCF Services managing director Gerry Frittmann, also outlined the advantages of the new R&D Tax Credit scheme.
“On the one hand, the long-running sectoral TCF and Automotive schemes we have been so influential in delivering since government began reducing high tariffs and quotas, will be phased out over the next 5-10 years. But on the other hand, a new R&D Tax Credit scheme now promises to provide - for many years to come - more targeted and meaningful incentives for companies operating across the broad innovation space - in all industry sectors,” he said.
The legislation that will enable the R&D Tax Credit, also contains powers to make regulations and decision making principles, to assist with administration of the new scheme.
The decision-making principles relate to the circumstances in which the Innovation Australia Board may extend deadlines, review findings about R&D activities and core technology, and vary registrations.
“Public input will help ensure administration of the R&D Tax Credit runs smoothly,” Carr said.