25/10/2007 - More and more OECD governments are giving firms tax breaks to drive innovation while cutting their direct spending on business research and development (R&D), and are also encouraging public research organisations to commercialise their inventions, according to a new OECD report.
According to the OECD Science, Technology and Industry Scoreboard 2007, two thirds of the 30 OECD member countries offered businesses tax subsidies in 2006, up from 12 in 1995, and most have tended to make it more generous over the years.
Direct government funding financed an average of 7% of business R&D in 2005, down from 11% in 1995.
Spain, China, Mexico and Portugal provide the largest tax subsidies and make no distinction between large and small firms. Canada and the Netherlands on the whole continue to be more generous to small firms than large ones. Emerging economies, including Brazil, India, Singapore and South Africa, also offer a generous and competitive tax environment for businesses investing in R&D.
The type of tax subsidy available varies from country to country but includes an immediate write-off of current R&D spending, as well as tax relief or allowances against taxable income.
The Scoreboard notes a sharp rise in the globalisation of innovation. International co-authorship of scientific publications tripled between 1995 and 2005. Cross-border co-operation on inventions nearly doubled as a share of total inventions worldwide between 1991-93 and 2001-03.
Foreign ownership of domestic patents increased by 50% between the early 1990s and the early 2000s. European Union countries interact most often with each other and are less globalised than the United States, while Japan and Korea are less internationalised overall, the report finds.
In addition to new data on the rising investment in knowledge by emerging economies, this edition of the Scoreboard shows that:
The report is available for journalists from the Protected Site for Journalists or from the OECD's Media Division (tel. 33 1 45 24 97 00). For further information about this report, please contact Dominique Guellec (tel. 33 1 45 24 94 39) or Maria Pluvia Zuniga Lara (tel. 33 1 45 24 80 04), OECD’s Science, Technology and Industry Directorate (see website www.oecd.org/sti/scoreboard).
The electronic web book edition is available to all via SourceOECD, our online library. Go to www.sourceoecd.org/stiscoreboard for a direct link to the Scoreboard.