Today, Grant Thornton published their review of the Irish R&D Tax Credits policy, available here: http://www.grantthornton.ie/db/Attachments/Review-of-RandD-tax-credit-regime.pdf?utm_content=buffer1e77c&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
Top level conclusions:
- "60% of the companies that responded to the survey were indigenous Irish companies with 40% multinationals"
- "35% of companies conducting R&D activities engaged in joint research projects with other parties in 2011"
- "with 19.5% being activities with higher education or institutes within Ireland and 8% outside Ireland"
- "70% of claims are by companies with less than 50 employees"
- "large companies with employees of more than 250 employees account for 10% of claims made. However they account for 45% of claims on a monetary basis"
"The credit is a largely positive scheme with real value being added to the economy from it."
My view: too much of subsidy to MNCs, too little evidence the scheme is not being used by SMEs to fund activity that would have been funded anyway and too little evidence the scheme is being used to fund genuine R&D rather than business development.
But aside from this, there is little evidence that funding is yielding any serious uptick in intellectual property generation. Here's the latest data from the NewMorningIP on patents filings in Ireland.
Based on quarterly aggregates, in Q4 2013, total number of Irish academic patents hit the lowest reading of 48 and the goal number of filed patents match this performance at 593. Irish inventions overall sunk to the lowest level of 236 (previous low was 252 for Q3 2012, imputed on incomplete data). Patents applications by non-academic filers stood at 188 - the lowest level in data series.
Overall, in 2013, there were 2561 patents applications, of which Irish total filings amounted to 1072 (41.9%) and of which Irish non-academic patents applications were just 860 (33.6%). This is hardly stellar and cannot be deemed sustainable for the economy that is allegedly based on innovation. It also makes clear that current system of R&D incentives and supports, including tax credit, is not working.
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