Political Principles

Promoting Research & Development

A potential incentive for innovation: tax-based research promotion in Germany

Tax credits are an extremely effective tool of government research promotion. They are easy to administer and they support research regardless of a company’s current profit situation. In addition, tax credits have a market-oriented and broad impact.

Three-quarters of all OECD countries and half of the EU member states have now introduced a form of tax-based promotion for research and development, making the tax-based promotion of research an important location factor. Introducing such promotion in Germany would first of all bring the country back up to international standard. Research-based companies of all sizes should benefit from such promotion.

Scientific studies back the introduction of the tax-based promotion of research: “One euro of promotion leads to one euro of additional spending.” Bayer has committed itself to reinvesting every euro received in tax-based research promotion into research.

Three Good Reasons:

First: Creates Sustainable Growth

Research promotion is an investment in Germany’s brainpower. It boosts the innovative strength of the economy and in this way lays the foundation for growth and the jobs of tomorrow. After all, the economic development of a country with next to no raw materials depends on the creativity of its scientists and researchers.

Second: Generates Broad-based Growth Stimuli

Supplementary tax-based promotion for R&D is not tied to any technology and stimulates the entire economy. It has a direct effect on the market and is application-oriented.

Third: Boosts Germany as a Business Location

Tax incentives can persuade domestic and foreign companies to further expand their research capacities here in Germany and thus create highly skilled jobs. An innovation-friendly tax system would strengthen Germany and secure future tax revenue.

Last updated: February 22, 2017 Copyright © Bayer AG