ResMed speaks out against R&D tax incentive cuts

Australian medical devices company ResMed has spoken out against the rumoured cuts to the R&D tax incentive.

A panel of advisers is recommending cuts to tax incentives for R&D in large businesses, with the money instead spent on offering tax relief to smaller companies.

Large businesses are understandably up in arms about the proposed changes, saying if such an overhaul takes place, R&D would shift to other countries.

ResMed CFO Brett Sandercock told media that it had factored in the tax incentive when it built its R&D department. If the incentive is cut, it will incur increased costs if it continues to develop its products in Australia.

ResMed is heavily R&D-focused, as are other medical devices and pharmaceutical companies in Australia.

However, proponents of the changes say these larger companies have R&D as a central part of their profit-making strategy, and are unlikely to cut research and development even if the government reduces its tax incentives.