MEDIA RELEASE R&D reforms dont go far enough While the recent by alendar

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R&D reforms don’t go far enough

While the recent changes to the R&D tax concessions are welcomed, there are a number of issues
the government should consider to provide proper assistance to businesses according to a respected
accounting and advisory firm.

Marc Peskett, partner of Melbourne based MPR Group, says in light of the National Innovation
Review, the recent changes by the government don’t quite go far enough to encourage further
investment in the area.

“R&D and the resultant technologies is one advantage our businesses have over many other
countries in the world, and our tax regime needs to fully support this,” Mr Peskett says.

“We are increasingly unable to compete internationally in areas such as manufacturing, however we
have some of the brightest minds and innovative companies in the world.

“The National Innovation Review set an appropriate benchmark, now it’s time we ensured its
recommendations are considered fully.”

Two areas Mr Peskett suggest need revisiting are quarterly rebates and the time frame for the
introduction of new measures.

“One of the main issues for most start-ups and high growth companies is cash flow,” Mr Peskett
says.

“We need to provide for quarterly R&D rebates to match company cash flow needs as this might be
the difference between their survival or failure.

“The move not to introduce the new measures until the 2010/11 financial year could also contradict
the government’s attempts to encourage immediate R&D activity, as many businesses may trade off
the immediate benefit by deferring expenditure until a later date in order to maximise their return.”

Mr Peskett says a higher tax credit of 50 percent should also be considered.

ENDS

For all media enquiries contact Bruce Nelson on 0423 403 449.

								
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