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Promotion of R&D

Tax & incentives

Australia has a variety of key programs to encourage and promote research and development in the private sector. These include 125% Tax Concession for R&D, Strategic Assistance for Research and Development (START) Program. Australia also has some sector specific incentives to encourage R&D in the private sector. There are currently seventeen primary industry R&D Corporations (RDCs). This chapter lists the concessions provided by the Department of Industry, Science and Tourism and also discusses the Strategic Assistance for Research and Development (START) Program. It also discusses the sector specific incentives to encourage R&D in the private sector.

Australia has a variety of key programs to encourage and promote research and development in the private sector. The programs are run by the Department of Industry, Science and Tourism and include:

• 125% Tax Concession for R&D: encourages Australian companies to increase expenditure on R&D by allowing a tax concession of up to 125% for expenditure on a wide range of activities.
• Strategic Assistance for Research and Development (START) Program: A new competitive program to assist industry with research, development and commercialization. Targeted at larger projects with clear commercial focus that may be high risk but have clear national economic benefits. START is a flexible program that will provide assistance in the form of grants, loans and interest subsidies. Two major elements under the START program are:

• Competitive grants for R&D: provide competitive grants to encourage R&D activities in firms which are unable to take full advantage of the 125% Tax concession targeted at small to medium businesses.
• Concessional Loans for Commercialization of Technological Innovation: provide finance on a competitive basis to small high-technology firms for early commercialization activities associated with technological innovation.

Sector-specific incentives

Australia also has some sector specific incentives to encourage R&D in the private sector. There are currently seventeen primary industry R&D Corporations (RDCs). Fourteen of these are industry-specific and are designed to provide an incentive for the primary industry sector to increase its R&D funding, to actively pursue research commercialization and technology transfer, and to become more responsible for its own R&D priority setting. The Government matches rural industry R&D contributions on a dollar-to-dollar basis in most cases up to a limit of 0.5% of each industry’s Gross Value of Production. The RDCs are run by the Department of Primary Industry and Energy. The CRCs, AECs and SIDCs also provide valuable centers for joint research between the public and private sectors.

The Government is also interested in directly assisting small high technology companies in their commercialization of R&D. The Government is the major investor in the Australian Technology Group Limited, a technology commercialization company that invests and manages early stage commercialization of research outcomes from both the private and public sectors.