One of the most cavalier and foolish actions of the National led government during its first 100 day blitz of legislation (in itself described by many as an assault on democracy) was the cancellation of the R&D tax credit.
The business community warned well in advance that cutting the credit was a very bad idea, but National went ahead anyway, and the action created hardly a ripple in the media..
Well this morning a small business owner got a chance to speak up on this issue. Ian Taylor of ARL, a computing company based in Dunedin, was being interviewed on Morning Report. He described how hard it is to succeed, how the company nearly folded, and how they have just had a major success winning a large contract with the BBC (audio link). This is what he had to say about the government and the cancellation of the tax credit:
The real question we should be asking ourselves is why aren’t there more of these stories happening.
I can see already politicians jumping on this ’cause it looks like a great good news story, you know battling New Zealand company with great innovation, aren’t we really good.
But actually, what I’ve found, is that politicians talk the talk and just don’t walk the walk…
One of the things I found absolutely staggering, I mean the reason we win this, and other New Zealand companies in this technology win this sort of stuff is because of the amount of R&D – this is all about R&D. And yet, I think that it was Rodney Hide, just the arrogance of the man, to dismiss the R&D tax rebate on the basis that it would be a rort for people who did R&D…
Well you know Rodney, get a life. The future of this country is about small companies doing a lot of R&D.
So here we are, relying on small businesses to pull through and lift NZ out of recession, with a government desperately casting round to find a credible way of stimulating the economy, and what have they done? Ignored the advice of the business community and cut one of the few things that could actually have made a difference. It’s profoundly stupid. Thank goodness someone finally said something.