Source · Select Committees · Business and Trade Committee
Recommendation 19
19
Inadequate R&D tax credit administration limits SME uptake, hindering national productivity growth.
Conclusion
Limited diffusion of productivity enhancing technologies is one of the primary causes of the UK’s sluggish productivity growth. Investment in R&D significantly boosts productivity. However, the administration of the 72 UK’s generous R&D tax credit system is limiting uptake amongst SMEs. The Government is right to recognise that the system requires reform, but larger-scale changes are needed to truly increase small business R&D investment. This should be combined with a clear strategy for encouraging firms to take up technology, led by local realities and designed around specific business need. (Conclusion, Paragraph 90)