The changes that were announced will hit start-ups when they are at their most vulnerable: at the stage when they have yet to start generating revenue.
At the other end, the R&D expenditure threshold — the maximum amount of R&D expenditure eligible for concessional R&D tax offsets — has been increased from $100 million to $150 million annually. That will only benefit big companies, most of whom are established.
The R&D Tax Incentive seeks to improve the quality and quantity of R&D investments and is a broad-based program that is accessible to all industry sectors where businesses get a refund or tax offset for undertaking R&D activities if requirements are met.
Exactly why the Incentive is available to big companies is difficult to fathom – unless it is done because these are the very firms that would donate to the coffers of political parties. Then the whole thing begins to make sense.
Start-ups often struggle to make payroll and political donations would be the last thing on the minds of the struggling souls who run these outfits.
The government is full of talk when it comes to things digital but it does not walk the walk. Technology does not need to be bound by geography and Australia has already lost at least a couple of solar entrepreneurs to China and the US.
But then as the saying goes, people act in haste and repent at leisure. This government is no different.