The House of Representatives Economics Committee invited Research Australia to make a submission to its inquiry into Tax Deductibility. The Inquiry’s terms of reference from the Treasurer are to investigate broadening the tax base and lowering the tax rate by identifying existing tax deductions that can be removed. Research Australia’s submission addressed the question of fairness when considering the removal of tax deductions that are of particular importance to some groups of taxpayers, and the use of deductions to provide incentives for particular expenditures. Research Australia’s submission focused on the tax deduction for self education expenses (important to the many researchers who are responsible for their own ongoing education) and the tax deductibility of donations to charities, including many not for profit health and medical research organisations.
Research Australia’s submission to the review of research policy and funding arrangements emphasises that the primary role of universities is the creation of new knowledge and that the application of new knowledge (of which commercialisation is one of the paths) is important but necessarily a secondary role. Programmes such as the Research Block Grants and the competitive grants programmes must maintain a primary focus on research. There is scope to simplify and improve these programmes and to better support innovation in research training.
In June 2013 the Australian Government issued a consultation paper seeking views on a proposal to assess the wider benefits of university based research. The paper proposed that a pilot exercise be undertaken in 2014 using case studies and quantitative data, and sought input on its design. Research Australia made a submission, urging a small scale ‘experimental’ approach using existing data to the greatest extent possible to test the feasibility and value of measuring research impact in this manner.
The May 2013 discussion paper released by Treasury proposes a $2000 cap on the tax deduction for self education expenses. In the health and medical research sector, where many researchers are forced to meet the cost of a range of expenses associated with work themselves, this proposal will have a significant adverse effect on health and medical research in Australia. Research Australia’s submission opposes the proposal.
UPDATE: The Government has subsequently withdrawn the proposal to impose a cap on self education expenses.