ACS: Too many Govt hoops stifling IT innovation

ACS recommends measures to improve Australia’s lack of successful ICT innovation commercialisation.

As part of its submission to the National Innovation Review, the Australian Computer Society has called on the government to simplify what it sees as an overly complex set of application hoops that companies and organisations must jump through in order to gain R&D tax offsets and grants. It has also asked the government to double the $1 million R&D tax offset threshold.

ACS president Kumar Parakala said that compared to other OECD countries, Australia has not been successful at commercialising and marketing its ICT innovations at a national or international level.

"Organisations or companies doing research work must go through an elaborate process explaining to the tax office whether that work qualifies under the R&D scheme, and the application of tax rules on whether something can be R&D or not is sometimes ambiguous," Parakala told Computerworld.

"This creates a situation, especially in the private sector, of being a bit hesitant before investing. I think our tax system is well known to be incredibly complex compared to other tax regimes around the world. If you are trying to invest in R&D you don't want to be slowed down because you aren't sure if you will get the tax deduction that is needed to get your return on investment."

Parakala cited the reduction in the value of R&D concessions from 150% to 125% as an example of where Australia is lagging behind the majority of other OECD countries, who have increased R&D tax concessions over the past decade.

He calls for Australia to reaffirm its role as a regional player in the Asia Pacific region through greater collaboration between local research entities and global organisations, to see whether Australian ideas and innovations can be successfully commercialised.

"Not many organisations in Australia have the capacity to take an innovation successfully to the market, so they need to work with large global organisations in doing so.

"R&D work being done needs to be [the kind of] work that can be commercialised. This doesn't mean that theoretical research is not important, it is just extremely difficult to get any commercial value out of," he said.

The ACS also wants to see greater collaboration between academia and industry, as academia can too often be cloistered in an environment that leaves it out of touch with commercial values.

"The more closely they collaborate on research the greater the chance you can commercialise it, because it's much more aligned to industry needs."

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