Home » News » Cochlear Comments on Australian R&D Tax and Innovation Policy

Cochlear Comments on Australian R&D Tax and Innovation Policy

October 14th, 2024 Our Team: Swanson Reed - Specialist R&D Tax Advisors

A recent article in The Australian has outlined comments from Dig Howitt, CEO of Cochlear, who believes Australia is at a crossroads when it comes to commercialising new innovative products.

Howitt noted the country’s current tax regime hinders research and development (R&D), showcasing that Australia needs to enhance its R&D tax incentives to remain globally competitive.

Howitt identifies that Australia’s productivity growth has declined steadily over the past decade. With economic growth on a per-capita basis also declining for the past six quarters, and inflationary pressures further exacerbate the situation. Productivity is one of the drivers of innovation and new product development. However, Howitt believes that Australia’s regime for supporting product commercialisation is uncompetitive.

Howitt states that Australia’s corporate tax rate is another hurdle to undertaking R&D and instead advocating for incentives targeted at boosting commercialisation. He acknowledges that the current R&D tax incentive was ‘actually a pretty good system’, but criticises the program’s $150 million expenditure threshold, as this cap limits the incentives utility, especially for larger entities.

Howitt believes that the current system discourages large companies from conducting and investing in significant R&D in Australia, and suggests increasing the threshold to $250 million and eventually moving towards an uncapped system to encourage more extensive activity.

Howitt also advocates revisiting The Patent Box proposal announced (but not legislated) in the 2021 budget by the former government.

Dig Howitt’s comments come ahead of the current Government’s review of Australia’s R&D System which was announced in the May 2025 budget. Swanson Reed notes the following from these comments:

- Cochlear is one of Australia’s most successful stories of commercialising R&D, and their comments must be strongly considered by policy makers;
- Howitt raises a good point that having a cap on expenditure does provide a disincentive for large companies to undertake more R&D once they reach the cap. The original cap placed on the R&D Incentive was as a budget control measure and the cap’s implementation may possibly have played a role in preserving stability of the R&D Incentive for smaller companies;
- Perhaps consideration could be given to extending the cap for companies that undertake knowledge intensive R&D Activity, as arguably an R&D Activity undertaken by CSL or Cochlear may possibly provide greater spillover than activity undertaken by a large mining company or a bank;
- Cochlear’s comments indicate that the R&D Tax Incentive, whilst not perfect, is generally well regarded by industry leaders;

Swanson Reed will continue to call for stability in the programme as the cornerstone for business investment in R&D.

Please get in touch with our office if you require assistance, would like to speak to someone about a potential claim, or check out our website for more information.

Are You Eligible?

Click here for the R&D Eligibility Wizard

R&D Audit Checklist

Archives

         Posted on Google  
   
   Daniel McGregor  
 11. August, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  I have been using Swanson Reed for my clients for more than a decade.  Having a specialist firm that can provide practical and commercial advice that produces real outcomes is very important and we have received great feedback from our clients.
Highly recommended.
  
 
 
      Posted on Google  
   
   John  
 15. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the rest of the team at Swanson Reed have been supporting us for several years.  We always appreciate their insights, expertise, and efforts.
  
 
 
      Posted on Google  
   
   Rueben Rajasingam  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Experienced responsive Team. They have been a great help to me and my company navigate the R&D tax claim process and have provided invaluable advice.
  
 
 
      Posted on Google  
   
   Enrique Esquivel  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the team at Swanson Reed have been extremely helpfully and professional during all of our consultations. Highly recommended.
  
 
 
      Posted on Google  
   
   Jess at Y&C  
 3. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  
  
 
 
      Posted on Google  
   
   Anatole Kononewsky  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Swanson Reed team have provided our company with exceptional professional advice and assistance for all of our R&D claims for many years - have always achieved great results with excellent value for their services.
  
 
 
      Posted on Google  
   
   Payam Toloo  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian Smyth and his team are very helpful, supportive and experts in their field of R&D Tax claims. I'm always happy with the work they do and been a customer of their for over 5 years.
  
 
 
      Posted on Google  
   
   Melissa Doddy  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Team at Swanson Reed are very experienced R&D Tax Advisors and gave us ongoing support with all of our R&D Claims, the consultants ensured we were always working with current legislative guidelines, gave us assistance with compiling technical and government documentation and went out their way to ensure they were with us for the entire process from beginning to end.  Highly recommended to anyone who needs assistance with working through what can at times be a daunting process.
  
 
 
      Posted on Google  
   
   Gary Watson  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  We can highly recommend Swanson and Reed as an R & D accountant. We have worked with them for several years now as they make our R & D claim so easy and communicate quickly with both us and our accountant.
  
 
 
      Posted on Google  
   
   Rob van den Bergh  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Always professional.
  
 
 
  
  Load more

         Posted on Google  
   
   Daniel McGregor  
 11. August, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  I have been using Swanson Reed for my clients for more than a decade.  Having a specialist firm that can provide practical and commercial advice that produces real outcomes is very important and we have received great feedback from our clients.
Highly recommended.
  
 
 
      Posted on Google  
   
   John  
 15. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the rest of the team at Swanson Reed have been supporting us for several years.  We always appreciate their insights, expertise, and efforts.
  
 
 
      Posted on Google  
   
   Rueben Rajasingam  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Experienced responsive Team. They have been a great help to me and my company navigate the R&D tax claim process and have provided invaluable advice.
  
 
 
      Posted on Google  
   
   Enrique Esquivel  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the team at Swanson Reed have been extremely helpfully and professional during all of our consultations. Highly recommended.
  
 
 
      Posted on Google  
   
   Jess at Y&C  
 3. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  
  
 
 
      Posted on Google  
   
   Anatole Kononewsky  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Swanson Reed team have provided our company with exceptional professional advice and assistance for all of our R&D claims for many years - have always achieved great results with excellent value for their services.
  
 
 
      Posted on Google  
   
   Payam Toloo  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian Smyth and his team are very helpful, supportive and experts in their field of R&D Tax claims. I'm always happy with the work they do and been a customer of their for over 5 years.
  
 
 
      Posted on Google  
   
   Melissa Doddy  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Team at Swanson Reed are very experienced R&D Tax Advisors and gave us ongoing support with all of our R&D Claims, the consultants ensured we were always working with current legislative guidelines, gave us assistance with compiling technical and government documentation and went out their way to ensure they were with us for the entire process from beginning to end.  Highly recommended to anyone who needs assistance with working through what can at times be a daunting process.
  
 
 
      Posted on Google  
   
   Gary Watson  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  We can highly recommend Swanson and Reed as an R & D accountant. We have worked with them for several years now as they make our R & D claim so easy and communicate quickly with both us and our accountant.
  
 
 
      Posted on Google  
   
   Rob van den Bergh  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Always professional.
  
 
 
  
  Load more

News & Research
News & Research

Swanson Reed submission to proposed legislative amendments titled ‘Better targeting the Research and Development Tax Incentive’

In the Federal Budget handed down on 12 May 2026, The Government proposed major structural changes to the R&D Tax Incentive (RDTI) proposed to commence on 1 July 2028. Proposed reforms announced in May 2026 include: Increasing the offset for […]

Publication of 2023-24 Report Data for Research and Development Tax Incentive entities

Reforms to the policy and administration of the R&D Tax Incentive (R&DTI) program were within Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Act 2020 which led to the requirement to publish details of claimant data. The most recent release of […]

Cochlear Comments on Australian R&D Tax and Innovation Policy

Post a Comment

Are You Eligible?

R&D Audit Checklist

Quick Contact

Categories

Archives

What Our Clients Say

Quick Contact

News & Research
News & Research

Cochlear Comments on Australian R&D Tax and Innovation Policy

Post a Comment

Are You Eligible?

R&D Audit Checklist

Quick Contact

Categories

Archives

What Our Clients Say

Quick Contact

News & Research News & Research

News & Research
News & Research