A political age ago a political Blue Hills began, with a narrative about reforming the research and development tax incentive.
First there was the Review of the Three Fs in 2016 (Bill Ferris, Alan Finkel and John Fraser) which proposed beneficiaries drink from slightly smaller rivers of gold. Ministers sat on that for months, many months, until nerves were raised and measures to scale back the concession appeared in the last budget – to be greeted by outrage.
The resulting bill was then sent to a Senate economics legislation committee, which heard at length, what a bad idea some of the saving measure were, before releasing its report yesterday.
Certainly, “governments, in ensuring accountability of taxpayer funds, need to constantly monitor, examine and strengthen such programs and industry as partners in such schemes also need to remain alert to the need for improvements,” senators state. But the $4m cap (clinical trials exempt) on the refundable tax offset in the bill, caught entrepreneurs unawares and “would benefit from some finessing to ensure that R&D entities that have already made investment commitments are not impeded unintentionally.”
Another change needs re-examining, “in order to ensure that Australian businesses are not unfairly disadvantaged.” Overall, the senators concluded; “the committee considers that the bill should not proceed until there is further consideration of the R&D tax incentive measures.”
Like Blue Hills, this is a saga that looks like it is over, and then isn’t.