Iceland plans to subsidise innovation

steingrimurSteingrimur J. Sigfusson, Icelandic Minister of Finance says he has submitted new bills on innovation to the Althingi parliament. If the Minister gets his way, innovation companies will be able to benefit from tax breaks and investors will be able to subtract shares in innovation businesses from their taxable income. The total package could be worth as much as ISK 1.5 billion to innovation companies each year.

The Minister spoke about the proposed assistance at this week’s conference on development and new business. He used part of his speech to talk about developments in other countries and spoke about his own bills which have already had their first parliamentary debate. He said that companies can already get part of their research and development costs refunded if carried out with the knowledge and approval of the Icelandic Centre for Research (RANNIS).

It is under discussion to allow individuals and legal entities to discount money invested in innovation company shares from their taxable income, RUV reports. Sigfusson said that the tax breaks will benefit the state and local councils in the long run as successful innovation companies start to hire more people and pay more tax.

The parliamentary bills look likely to be passed in Althingi’s autumn session and would then start to have an impact immediately in the New Year, although refunds to affected companies would come later.

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