CBI calls for the world’s most competitive R&D Tax Credit
20 June 2019
The CBI has called on the government to “deliver the world’s most competitive R&D Tax Credit by ensuring that it recognises the growing importance of data-driven R&D”.
In its recent report, Innovation: The Changing Nature of R&D, the CBI notes that the UK’s R&D Tax Credit scheme is “relatively generous by Organisation for Economic Co-operation and Development standards”. However, the CBI states: “The Treasury should ensure the R&D Tax Credit evolves to reflect the reality of modern technologies and data-driven innovation. The Treasury should consider amending definitions of eligible activities to include the costs of purchasing, storing, using and analysing data which have been used in driving R&D and innovation in the UK.”
The CBI also calls on the government to act on its commitment to deliver the target of R&D being 2.4% of GDP by 2027 by publishing a comprehensive roadmap. “This roadmap must be underpinned by the necessary public funding to catalyse growth in UK R&D investment. If R&D investment continues at the current rate of growth, the UK will not reach the 2.4% target until 2053, 26 years too late. Building the UK’s strengths and capabilities around data and analytics must be a key feature of this strategy,” the CBI says.
Garry Hague, Director at R&D Tax Specialists, said: “Around half of the R&D Tax Credit claims we make are on behalf of companies involved in IT and software development. We fully support the CBI’s call to broaden the definition of eligible activities that can be claimed for. This will enable companies to further leverage the benefits of the R&D Tax Credit scheme enabling further investment in technology development and improved competiveness.”
The CBI report can be downloaded: https://nexusleeds.co.uk/wp-content/uploads/2019/05/Changing-Nature-of-R-and-D.pdf
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