Another Federal Budget measure:Treasury|Part 1: Receipt...

Another Federal Budget measure:

Treasury|
Part 1: Receipt Measures|Page23
Patent Box–expanding the patent box tax concession tolowemissions
technology innovations

The Government will expand the patent box, announced in the 2021-22Budget and
currently before Parliament, to support the Government’s technology-focused approach
to reducing emissions in line with the Government’s targetto achieve net zero emissions
by 2050.
The expanded patent box will provide concessional tax treatment for corporate
taxpayers who commercialise their patented technologies which have the potential to
lower emissions. Eligible corporate income will be subject to an effective income tax rate
of 17 per cent, for patents granted after 29March2022 and for income years starting on
or after 1July2023. Eligible income will be taxed at the concessional tax rate to the extent
that the research and development of the innovation took place in Australia.
Australia currently taxes profits generated by patents on low emissions technologies at
the headline corporate rate (30 per cent for large businesses and 25 per cent for small
enterprises). The patent box will offer a competitive tax rate for profits generated from
eligible Australian owned and developed patents, supporting the commercialisation of
innovation in Australia.
Patents relating to low emissions technology, as set out in the 140 technology areas listed
in the Government’s 2020 Technology and Investment Roadmap Discussion Paper or
included as priority technologies in the Government’s 2021 and future annual Low
EmissionsTechnologyStatementswillbewithinscope,providedthepatented
technology is considered to reduce emissions.
The Government will consult with industry before settling the detailed design of the
patent box expansion to low emissions technologies.
This measure is estimated to decrease receipts by $30.0million, and increase payments
by $66.2million over the forward estimates period