(Excerpted from the Department of Finance Website)
On October 5, 2007, the Honourable Jim
Flaherty, Minister of Finance, and the Honourable Gordon O’Connor, Minister of
National Revenue, launched consultations on how to make the scientific research
and experimental development (SR&ED) tax incentive program more effective
for Canadian business and allow it to play an even greater role in fostering a
more competitive and prosperous economy.
In the government’s press release, Flaherty stated: “Canada’s tax incentives for research and development (R&D) are among the most advantageous in the world.” “He noted that “other countries are not standing still, and neither will we. We want to maximize the efficiency of our R&D incentives for Canadian innovators.”
The SR&ED tax incentive program is the
single largest federal program supporting business R&D in Canada, providing over $3 billion in tax assistance to Canadian businesses in 2006. The SR&ED program plays, and will continue to play, a leading role in fostering a competitive and dynamic business environment in Canada. In undertaking these
consultations, the Government’s overriding objective is to increase the level of private sector R&D by implementing cost-effective improvements to the tax incentives and further streamlining the program’s administration.
Flaherty noted that “private sector R&D
is crucial to the long-term growth and prosperity of our economy.” He emphasized that this broad-base
consultation process will help improve Canada's existing programs.
The Government is releasing a consultation paper entitled Tax Incentives for Scientific Research and Experimental Development, which is intended to provide a basis for discussion and stakeholder input on a number of key questions relating to the SR&ED