StartupAus has shared its policy recommendations with New Industry Minister Christopher Pyne to encourage startups with tax incentives, double R&D tax concessions and extending the mining sector direct liability exemptions.
Pyne met with the peak advocacy group for technology entrepreneurship on Friday to discuss its recommendations for federal policy priorities to support technology startups. StartupAUS said it aimed to discuss the recommendations with all major parties in the lead up to the 2016 federal election.
The three-prong approach presented to Pyne involved adopting the UK’s successful Seed Enterprise Investment Scheme (SEIS), by creating income and capital gains tax incentives for early stage startup investments to support their overall growth and economic impact.
The second recommendation was to double the current R&D tax concessions for technology startups. Though the current R&D Tax Concession regime already benefits young innovative companies in staffing and product development, StartupAUS said the government should aim to double its current efforts to boost employment and competitiveness among startups, while offsetting costs with a reduction in the rate available to large established companies.
Lastly, StartupAUS suggested the government extend mining sector direct liability exemptions to technology startups via an amendment to the Corporations Act.
This recommendation is based on current legislation that recognises the inherent risks associated with prospective ventures in the mining industry and therefore excludes directors from liability. StartupAUS says the same exemption should be granted to directors on the boards of important startup ventures with a natural risk of failure.
StartupAUS policy recommendations come after a recent report by PwC that predicted technology based startups are worth over $US109 billion and have the potential to create 540,000 jobs by 2033. StartupAUS said these jobs are critical when the Committee for Economic Development of Australia also recently predicted that 40 per cent of Australian jobs could be replaced by automation in the next decade.
“Australia’s economy is at a critical juncture. With the right policy settings we can build an agile, innovative economy capable of taking advantages of the enormous opportunities technology is creating,” said Peter Bradd, CEO of StartupAUS.
“To realise these gains, we need to take a vision for innovation which is coordinated and strategic. A comprehensive national innovation agenda would help build towards that goal.
“But this change is coming fast. There are a small number top priority measures, which would have an immediate positive impact on our innovation economy. These policy changes would provide a boost to startups in two core areas: capital and talent.”
Earlier this year, StartupAUS also released the latest version of its Crossroads report to help Australia capitalise on the enormous opportunities technology presents.