{"id":47730,"date":"2023-10-20T15:54:47","date_gmt":"2023-10-20T15:54:47","guid":{"rendered":"http:\/\/startupsmart.test\/2023\/10\/20\/innovation-taxation-changes-explained-and-the-best-way-forward-for-australia-startupsmart\/"},"modified":"2023-10-20T15:54:47","modified_gmt":"2023-10-20T15:54:47","slug":"innovation-taxation-changes-explained-and-the-best-way-forward-for-australia-startupsmart","status":"publish","type":"post","link":"https:\/\/www.startupsmart.com.au\/uncategorized\/innovation-taxation-changes-explained-and-the-best-way-forward-for-australia-startupsmart\/","title":{"rendered":"Innovation taxation changes explained and the best way forward for Australia – StartupSmart"},"content":{"rendered":"
Everyone is talking about an ecosystem – a startup ecosystem, an innovation ecosystem, an early-stage ecosystem.<\/p>\n
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The first and the last are pretty much the same thing, the middle one perhaps not. But what they all have in common is that they demand sustained effort, sustained change and a fundamental shift into the habit of collaboration.<\/p>\n
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To do that we need to get the taxation incentives model right for Australia.<\/p>\n
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A good place to start is to ask that our government models its measures on the UK Enterprise Investment Scheme (EIS). The UK also has the Seed Enterprise Investment Scheme (SEIS)<\/em><\/p>\n The precise details of the Turnbull government\u2019s proposed legislation have not yet been made public, so we only have the broad brush description of the National Innovation and Science Agenda:<\/p>\n <\/p>\n <\/p>\n The EIS offers the following for the eligible combination of investor and company:<\/p>\n <\/p>\n <\/b><\/p>\n Eligibility to claim tax relief:<\/b><\/p>\n <\/p>\n Income Tax Relief<\/b> <\/p>\n Capital gains Tax Exemption<\/b> <\/p>\n Loss Relief<\/b> <\/b><\/p>\n <\/p>\n Capital Gain Rollover Relief<\/b> <\/b><\/p>\n <\/p>\n SEIS or EIS<\/b><\/p>\n <\/b><\/p>\n The SEIS limits the maximum a company can ever receive to \u00a3150,000 ($312,000), so it\u2019s a tax scheme for very small seed investment.<\/p>\n <\/p>\n That\u2019s too little, too late for Australia. We want a tax scheme that keeps angels funding companies through to exit, especially given the very shallow pool of VC in Australia for the foreseeable future.<\/p>\n <\/p>\n I hope that our government will consider modelling on the EIS, increasing the income tax relief to 30%, remove the 10-year cap on CGT relief, broaden the share type to allow normal angel-style preferences, accommodate SMSF as investment vehicles and use fund raising caps that are relevant to our context.<\/p>\n <\/p>\n Together with fixing the still broken Employee Share Scheme regime these measures could go a long way to increasing participation and collaboration in the early-stage ecosystem.<\/p>\n <\/p>\n Success for Australia in the new innovation economy has many aspects but for the startup community it is fundamentally about dramatically increasing the number and diversity of startups.<\/p>\n <\/p>\n That means liberating a much higher volume of direct private investment and the right tax incentives will really help.<\/p>\n <\/p>\n Jordan Green is the founder and president of Melbourne Angels.<\/i><\/p>\n <\/p>\n This piece was first published on LinkedIn. Read the original version here. <\/i><\/p>\n","protected":false},"excerpt":{"rendered":" Everyone is talking about an ecosystem – a startup ecosystem, an innovation ecosystem, an early-stage ecosystem. The first and<\/p>\n","protected":false},"author":1,"featured_media":58377,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/47730"}],"collection":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/comments?post=47730"}],"version-history":[{"count":0,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/47730\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media\/58377"}],"wp:attachment":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media?parent=47730"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/categories?post=47730"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/tags?post=47730"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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