Dáil Éireann Debate, Tuesday - 11 July 2023
218. Deputy Pearse Doherty asked the Minister for Finance the estimated first-and full-year cost of increasing the percentage of qualifying expenditure under the research and development tax credit from 25% to 30% for SMEs.; and if he will make a statement on the matter. [34403/23]
View answerIt is not possible to accurately project the cost of increasing the portion of expenses allowed for deduction under the Research and Development tax credit from 25% to 30% for SME companies as the R&D credit is based on qualifying R&D expenditure and information in respect of future qualifying expenditure by SMEs is not available.
However, I am advised by Revenue that, based on claims in respect of the research and development tax credit included in 2021 tax returns, the estimated tax cost of increasing the rate to 30% for SMEs could be in the region of €40 million in a full year. This cost assumes no behavioural change. I would also note that introducing a targeted element to the credit would have State aid implications.
