A news story of great interest to TEC Edmonton's client companies, and indeed, any regional companies claiming, or thinking of claiming, SR&ED  - Scientific Research and Experimental Development -  federal tax credits.

In a Globe & Mail article published Jan 27, 2012, entitled "Harper signals Canada's looming R&D revamp," author Barrie McKenna suggests all signals indicate, perhaps as early as the next federal budget, the Prime Minister Stephen Harper will act soon on the recommendations of a task force chaired by Open Text Corp. Chair Tom Jenkins.

The task force report says Canada is not getting good value for its innovation-incentive program, costing the Canadian tax payer some $3.5 billion a year.

Canada, the task force says, is spending less on research and development (R&D) than the country did five years ago, and is falling behind other countries, despite one of the most general tax and incentive regimes in the world.

The task force suggests the SR&ED tax credit be made simpler and smaller, with the resulting savings diverted to more focused funding of business innovation.

The expected changes are the culmination of long and persistant criticism of the SR&ED tax credit program.

The Globe & Mail, for instance, did an investigation of the program back in March, 2011, that more than  highlighted its inadequacies and potential for abuse.  A federal investigation of the SR&ED program is in the works from the Office of the Federal Taxpayers' Ombudsman. 

(Thanks to TEC Edmonton Executive-In-Residence Jason Ding for bringing this story to TEC Talk's attention.)