Global investment and innovation incentives updates: April 2017 | Deloitte US has been added to your bookmarks.
Global investment and innovation incentives updates: April 2017
Global developments benefiting business
This monthly publication provides a summary and updates on the latest global developments in research and development (R&D) credits, grants, and other incentive arrangements. More than 50 countries offer specific incentives and this newsletter focuses on identifying and outlining what could be the right incentives for your organization.
The LIFE programme, one of the financial instruments supporting environmental, nature conservation, and climate action projects throughout the European Union, has more than EUR 390 million available in 2017 for funding projects to be undertaken by companies in the European Union that involve the following:
- Prevention or reduction of air or noise pollution,
- Reduction of greenhouse gases,
- Renewable energy technologies or energy efficiency,
- Improvements in the energy or environmental performance of products or services,
- Development of innovative clean technologies,
- Methods for monitoring and managing the environmental impact of the company’s activities,
- Managing environmental risks, such as rehabilitation or decontamination,
- Integrated waste management and prevention, resource use, waste treatment, or recycling, and
- River basin management, water scarcity, water/waste water management, or improving groundwater quality.
Applications may be submitted by a legal entity that has its registered office in the European Union, and the grants can be up to EUR 4 million for individual projects, although they typically amount to between EUR 1 and EUR 3 million. The maximum rate of co-financing (support) is 60 percent for the 2014–2017 period and claims can be made on a unilateral basis without any need for collaboration, although collaborative projects are welcome.
|Scheme budget||EUR 390 million for 2017
|Type of incentive||Cash grant|
|Deadline||Call opens: 28 April 2017
Call closes: 30 September 2017
The Epsilon programme, announced by the Technology Agency, focuses primarily on improving the position of Czech industry by providing support to projects in applied research and experimental development whose results will have a high potential for being quickly applied to new products, production processes, and services. The maximum level of support per project is 60 percent of the total eligible costs. Subsidy recipients include small and medium-sized enterprises (SMEs), and large entities, and research institutions.
|Scheme budget||Maximum support is EUR 3 million per project|
|Type of incentive||Cash grant|
|Deadline||To be determined|
Removing hazardous old environmental burdens
The new call, as part of the “Environment” Operation Programme announced by the Ministry of the Environment and the State Environmental Fund, will help reduce the number of hazardous old environmental burdens in the Czech Republic. Applicants are to be awarded a total of CZK 400 million (approximately EUR 15 million), with CZK 20 million designated for the performance of research and risk analysis and CZK 380 million for remediation.
Grant applications primarily may be submitted by businesses that provide services relating to the disposal of environmental burdens, as well as by municipalities, regions, and charitable trusts. Grants for all supported measures may amount to a maximum of 85 percent of eligible costs.
|Scheme budget||EUR 15 million
|Type of incentive||Cash grant|
|Deadline||30 June 2017
Nanoscale carbon materials: From basic research to industrial implementation
R&D and demonstration projects with the following goals may request funding:
- Application-oriented development of nanoscale carbon materials,
- Improving the production process and process understanding,
- Further development of the processing chain,
- Clarification of aspects of work safety or environmental protection in the processing of nanoscale carbon-materials, and
- Support network and transfer projects for organizational and content-related tasks.
|Scheme budget||For companies, up to 50 percent of project-related costs are eligible
For research institutions and universities, up to 100 percent of project-related costs are eligible
|Type of incentive||Non-repayable grant to a consortium consisting of at least one company and one research institution/university|
|Deadline||30 June 2017|
Pilot action: SME-NetC
R&D and demonstration projects led by SMEs and innovation networks of SMEs focusing on one of the following topics may receive funding:
- Expanding the innovation base of SMEs and increasing focus on innovation, especially in all fields of process digitalization (open to all technologies), and
- Increasing global competitiveness and changes to current business models by platform implementation.
Non-technological innovations, such as the development of new business models, also are eligible.
The aim of the innovation networks should be to support SMEs that lack experience with public funding (e.g. that have not yet applied for funding) or that have never received European or German project funding.
The innovation networks also should aim to support the increasing cooperation of SMEs with research institutions and universities.
|Scheme budget||For SMEs, up to 50 percent of project-related costs are eligible
For research institutions and universities, up to 100 percent of project-related costs are eligible, additional funding may be available in the form of a 20 percent project-based lump sum
|Type of incentive||Non-repayable grant to a consortium of at least one SME and one research institution/university
|Deadline||30 April 2017 (more deadlines expected to be published)|
Energy revolution in traffic: Combining different sectors by using power-based fuels
The call follows a cross-sector approach aimed at funding innovative energies and traffic-related topics (traffic for this purpose includes both land-based and water-bound transport systems). The program aims to encourage the use of synergies from cross-sectoral research approaches by providing funding for R&D and demonstration projects focusing on:
- Technological development of power-based fuels,
- Adjustments of conventional drive technology and development of new fuel composition, and
- Innovative drive technologies for application in cars, trains, and vessels.
|Scheme budget||For companies, up to 50 percent of project-related costs are eligible if the project is applied research and 25 percent for basic research
For research institutions and universities, special rules will be applied to determine the funding rate
|Type of incentive||Non-repayable grant to a consortium of at least one company and one research institution/university
|Deadline||23 June 2017|
Research, Create, Innovate
Grants ranging from 25 percent to 100 percent of eligible expenditure will be available for R&D projects carried out by SMEs, by a consortia of enterprises and research institutions and by individual enterprises for projects utilizing research findings (patents, IP, publications, etc.). The relevant areas are multifunctional and advanced materials, cultural and creative industries, agrofood, the environment and sustainable development, life sciences and health/medicine, transport and logistics, energy, information, and communications technologies.
Large enterprises may participate as single entities (for use of research findings) and in consortia.
|Scheme budget||EUR 280 million|
|Type of incentive||Grants|
|Deadline||Three calls for proposals:
1) 17 May 2017 – budget of EUR 126 million
2) 15 April 2018 – budget of EUR 84 million
3) 15 April 2019 – budget of EUR 70 million
“Decreto Sud”—Tax credit for investment in Southern Italy
Decree Law 243/2016 increased the tax credit available for new capital expenditure in certain southern regions of Italy (Campania, Puglia, Basilicata, Calabria, Sicily, Molise, Sardinia, and Abruzzo) acquired between 1 January 2016, and 31 December 2019.
|Scheme budget||No overall budget is published
The amount of the tax credit depends on the size of the company and the region where the investment is implemented:
1) For large companies, up to 10 percent or 25 percent of eligible costs (capped at EUR 15 million)
2) For medium-sized companies, up to 20 percent or 35 percent of eligible costs (capped at EUR 10 million)
3) For small companies, up to 30 percent or 45 percent of eligible costs (capped at EUR 3 million)
|Type of incentive||Tax credit|
|Deadline||31 December 2019
R&D tax incentive
As from 6 January 2017, taxpayers exclusively engaged in innovation activities and R&D (defined under the relevant legislation) are exempt from corporate income tax for the first 10 years of activity. Taxpayers already registered with the tax authorities will be exempt for corporate income tax for 10 years starting from 6 January 2017 (provided they are exclusively engaged in innovation and R&D activities).
This exemption will operate subject to compliance with state aid regulations.
|Type of incentive||Corporate income tax exemption|
Salary income tax exemption for employees carrying out eligible software development activities
As from 1 February 2017, the salary income of employees performing specific software development activities for Romanian companies carrying out software development activities (as defined under the relevant legislation) is exempt from income tax, irrespective of the company’s turnover from such activities in the previous year. Previously, the employer had to have at least USD 10,000 in revenue from the creation of computer software for sale for the exemption to apply. The employer must determine whether the employee qualifies and apply the exemption on behalf of the employee.
For a limited period of time, start-ups and companies that have undergone corporate reorganizations (e.g. mergers, spin offs, transfer of business) may apply the exemption for the employees carrying out software development activities, even if the companies do not derive any income from such activities. The time period for start-ups is the year of incorporation and the following tax year and the year of reorganization for companies that have undergone a reorganization.
|Type of incentive||Salary income tax exemption|
Collaborative R&D: Emerging and enabling technologies: Round two
Innovate UK is investing up to GBP 15 million in innovation projects that inspire and stimulate the products and services of tomorrow. The aim of this competition is to help UK businesses broaden their innovation activities, disrupt existing markets, and find new revenue sources.
The competition will focus on four priority areas:
- Emerging technologies,
- Enabling capabilities, including electronics, sensors and photonics (ESPs), robotics and autonomous systems, and creative economy, and
- Space applications.
The competition is open to SMEs (as defined in the European Union), as well as large companies. A SME can apply on its own for funding up to GBP 100,000. Large companies can apply only as part of a consortium (and all consortia must involve at least one UK SME).
Projects are expected to range in size from total costs of GBP 35,000 to GBP 2 million and should last between 18 and 36 months.
For a large company, up to 50 percent of project costs is available for industrial research, and up to 25 percent for experimental development. For a SME, the incentive could be worth an extra 10 percent or 20 percent, depending on whether the company is considered medium or small.
|Scheme budget||GBP 15 million|
|Type of incentive||Cash grant|
|Deadline||Registration: 3 May 2017
Application: 10 May 2017
Collaborative R&D: Accelerating innovation in rail: Round four
Innovate UK, on behalf of the UK Department for Transport, is to invest up to GBP 9 million to support growth in national and international rail markets.
The focus of this competition is industrial research. Proposals must demonstrate how they meet specific industry challenges with future exploitation as a key priority. Applications should provide evidence of a market need for specific solutions and engagement with potential rail industry customers.
Projects are expected to range in size from total costs of GBP 150,000 to GBP 1 million and should last up to 12 months. Projects outside of these ranges also may be considered.
Proposals must be collaborative, business-led by a UK-based company, and involve at least one UK-based SME.
Grants of up to 50 percent of project costs for industrial research are available for large companies. For SMEs, the incentive could be worth an extra 10 percent or 20 percent, depending on whether the company is considered medium or small.
|Scheme budget||GBP 9 million|
|Type of incentive||Cash grant|
|Deadline||Registration: 10 May 2017
Application: 17 May 2017
For more information
For more information on any of the programs listed above, please contact the in-country representative or your usual contact.
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