Pharmacy Daily | MA: Leave the credit alone

MEDICINES Australia is urging the Government to leave the R&D tax credit which it introduced last year, alone, following reports that the Government may want to make changes to the scheme. Speaking in the wake of the rumours, Medicines Australia CE, Dr Brendan Shaw said that winding back the tax credit would discourage investment in Australia and would result in the loss of high value research jobs. “Scaling back the R&D tax credit would be extremely damaging to R&D investment in Australia,” said Shaw. “Such a move would put a brake on investment at the very time when policy makers are trying to stimulate growth. “It would effectively add up to 10 per cent to the cost of investing in Australian R&D and would put at risk hundreds of high-skill, highwage research jobs,” he added. Currently, Australia attracts $1 billion per annum in pharmaceutical R&D investment. The Government, according to Medicines Australia, would risk losing large chunks of this investment if the tax credit were to be reduced, with some companies bound to withdraw their research interests from the nation altogether. Adding further fuel to the argument, Shaw said that due to the relatively new nature of the tax credit, with it only having been introduced less than a year ago, not enough time has elapsed to be able to see its benefits in terms of investment. “The Government went through an extensive consultative process in developing the tax credit system to replace the previous tax concession, which was inefficient and ineffective,” Shaw said. “To do a U-turn on such an important policy measure after less than a year would send quite the wrong signal to the investment community. “It would severely undermine business confidence, send investment offshore and threaten Australian jobs,” he added.

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