AIM Incentive aims to increase local commercialisation

A
group representing Australian medical manufacturers and exporters has proposed
taxation changes to a Senate inquiry into Australia’s innovation system.

The
group – including Cook Medical Australia, AusBiotech, the Medical Technology
Association of Australia, and the Export Council of Australia – has proposed an
Australian Innovation & Manufacturing (AIM) Incentive, which has
similarities to “Patent Box” schemes seen in countries including the UK,
Switzerland and China.

The
scheme would offer a reduction in tax payable from profits “derived from the
commercialisation of qualifying intellectual property (IP) (mainly, patents or
licences to patents)” within Australia.

Its
aim is to create jobs as well as further investment in Australian
manufacturing.

“We
have proposed the AIM Incentive to support local innovators and manufacturers,
so they can maintain their global competitiveness and cultivate domestic innovation,
all while attracting the commercialisation of additional international IP to
Australia,” said Dr Anna Lavelle, Chief Executive Officer of AusBiotech, in a
statement.

The UK’s patent box scheme, introduced last year, lowers corporation tax to 10 per cent for the revenues that qualify from the usual 23 per
cent.

Barry
Thomas, Managing Director of Cook Medical, has said that the current R&D
Tax Incentive encourages the development of Australian IP, but not the local development and manufacturing based on it.

“The criteria for qualifying IP is extended to
patents, copyright, registered designs, licenses and ‘know-how’. Also
included in the qualifying IP criteria would be companies that manufacture
products offshore, provided that Australia will derive a significant net benefit
from its sale overseas,” he explained of the AIM proposal in an opinion piece
for Manufacturers’ Monthly earlier this year.

“Qualifying IP can either be developed in
Australia or in-sourced from outside of Australia.”

Submissions to the Senate inquiry can be viewed here.

Image: http://www.innovationmanagement.se/