The Impact of Statute for Industrial Innovation on R&D Expenditure and Tax Burden

• Main Authors: Ting Hsuan Chen, 陳庭軒
• Other Authors: Jui-Chih Wang
• Format: Others
• Language: zh-TW
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/7e8f72

碩士 === 國立臺北商業大學 === 會計財稅研究所 === 106 === In order to promote industry development and enhance the competitiveness of enterprises, the government of Taiwan R.O.C. enacted the Tax Incentive Policy as a tax motivation to encourage businesses to engage in R&D activities. However, to improve the tax inequality in the industry, the “Statute for Industrial Innovation” implemented in 2010 preserved only the investment credit tax benefit. Thus, this study aims to explore whether the implementation of “Statute for Industrial Innovation” has influence on companies’ R&D expenditures and effective tax rate. The study uses the sample of TWSE/GTSM listed companies during 2007~2016 and multiple regressions in empirical analysis. Regarding the impact of “Statute for Industrial Innovation” on R&D expenditure, the empirical results show that although “Statute for Industrial Innovation” canceled most of the tax benefits, its tax incentive is still a motivation for businesses to increase R&D. Furthermore, the brand image expenditure also has significant and positive impact on a company’s R&D. Businesses will also increase its innovation ability while developing their brands. Last but not least, as “Statute for Industrial Innovation” limited tax benefits and thus creates a shock, businesses then further cut down on their devotion to R&D. Regarding the impact of “Statute for Industrial Innovation” on effective tax rate, due to the tax shield effect of the research and development expenditure, then reduces the effective tax rate. Furthermore, companies with higher the research and development expenditure will increase effective tax rate due to the tax concessions sharply reduced after the implemented of“Statute for Industrial Innovation”. After the implementation of the“Statute for Industrial Innovation”, when the company’s investment tax credit benefit are higher, the tax burden will be reduced and the effective tax rate will be lowered.