Research and development benefits

By: Clayton Mitchell

Clayton Mitchell
New Zealand First MP

With its eyes firmly focused on generating a more productive economy and supporting innovation, the Government has fine-tuned its Research and Development tax credit scheme, to allow loss-making and pre-profit businesses to gain their share of the benefits.

The $1 billion scheme, announced earlier this year, sees businesses able to claim a 15 per cent rebate if spending $50,000 or more on R&D, but this is of little benefit to start-ups and businesses yet to turn in a profit.

We know that some of the most effective R&D activity is delivered by young businesses and it is only fair that they are able to access the benefits of the scheme. To that end, broader cash entitlements will now be available to support eligible R&D for businesses in loss.

New Zealand First has always stood for a productivity-focused economy where the outputs of our economy exceeds its inputs. Key to this is innovation. Greater innovation can give an organisation the competitive edge and add real value to their products and services.  In short, we need to encourage investment in great ideas.

The previous Government relied on skyrocketing immigration to inject more money into the economy. We’re focussing on actual measures to build productivity and give businesses the support they need to increase innovation.

The R&D tax credit scheme was a key policy initiative of New Zealand First and fought hard for in Coalition negotiations. It joins the $3 billion Provincial Growth Fund and the $300 million Venture Capital Fund as policies all working to boost the country’s economic outputs. Higher economic productivity helps drive economic performance, higher wages, and higher living standards.

The Coalition Government is committed to improving the lives of New Zealanders and has already made great strides towards delivering a more productive nation.