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More than three-quarters (78pc) of R&D professionals believe an enhanced 50pc R&D tax credit will incentivise green tech development.
According to a report on the state of R&D in Ireland by the Industry Research and Development Group (IRDG) and KPMG, the state needs to increase funding by €2bn to catch up with other innovation-leading countries.
The report, titled ‘Ireland’s Innovation Index’ surveyed 394 respondents across the engineering, tech, medical and software sectors. The majority (80pc) plan to increase their R&D spend in the next three years, while 67pc have already increased their R&D budget in the past three years. Only 4pc anticipate they will not increase spending in the future.
Ireland performs well in R&D, which is a big contributor to the economy. More than two-thirds (69pc) of multinationals believe Irish R&D grants and tax supports compare equally or favourably to other countries. Only 31pc said it compares negatively.
As many as 64pc of respondents have availed of the RDTC, which is the R&D tax credit here, while 53pc have availed of semi-state grant supports. However, the IRDG finds that Ireland needs to increase its funding for R&D significantly to match the leading countries.
More than three-quarters (78pc) of R&D professionals believe an enhanced 50pc R&D tax credit will incentivise green tech development.
“We are underspending on innovation and need to significantly increase our investment to meet the challenges of sustainability and digitalisation and to ensure continued economic prosperity,” said Dermot Casey, CEO at IRDG.
“It is clear we need additional support to help innovative SMEs create the next generation of Irish Kingspans and Fexcos, and to underpin our FDI sector. Access to skills, talent and admin burdens are all challenges innovative companies are grappling with and investment can address these. Businesses are planning to invest and they need to be supported in doing so.”
Ken Hardy, head of KPMG’s R&D incentives practice, said that many other European jurisdictions, including our nearest neighbour, the UK, are “aggressively competing to attract R&D”, and Ireland needs to up its supports and budget. Hardy did note that “It’s very positive to see that over two-thirds of Irish RD&I professionals feel Ireland’s support systems compare well to other countries.”
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