U.K. R&D Tax Policy Needs Reform

Introduction:

Innovation is at the heart of the UK’s strategy to boost productivity and economic growth. It offers new opportunities to increase the competitiveness of UK firms and create transformative technologies which address societal challenges ranging from climate change to better health outcomes. According to the Office of National Statistics (2020); net expenditure on research and development (R&D)hit a new high of £13.1 billion in 2019. Similarly, the total R&D expenditure on knowledge transfer activities reached £13.4 billion in 2019 and represents 0.6% of gross…