Deloitte calls for tech start-up incentives
According to Deloitte, Australia’s innovation future is under threat, due to the many high-growth start-ups, or ‘gazelles’, being lured overseas. They are attracted by favourable incentives, opportunities to network with like-minded gazelles and potential investors, as well as profile-building opportunities in innovation hotspots around the world.
Deloitte has asserted that Australia needs to do more to incentivise start-up companies, in order to prevent talented people and business potential from leaving the country.
“Australia is home to a huge number of growing start-ups with world-class ideas, technologies and potential, and we must keep it that way,” said Joshua Tanchel, Deloitte private partner and leader of Deloitte’s Technology Fast 50 Program.
Tanchel believes tax-based initiatives such as the Enterprise Investment Scheme and Entrepreneur’s Relief and Patent Box in the UK are beneficial and help to harness the ‘ideas boom’ currently taking place.
“We need to identify the opportunities attracting our gazelles overseas and learn from them,” he said. “Israel offers a range of incentives both to home-grown entrepreneurs and foreign investors, including tax incentives for angel investors and government co-investing with experienced venture capitalist funds. They also invest in programs to nurture talent and strengthen links between academia and industry and prioritise a responsive business environment. As a result, second only to Silicon Valley, Israel has the highest concentration of high-tech start-ups globally.”
In addition, Singapore offers offer tax deductions for investors, concessional tax rates for start-ups and a Technopreneurship Investment Fund that aims to attract high-growth companies to the country. They also have a grants scheme that funds the salaries of technical staff.
Tanchel said, “We must learn from these global exemplars, while also recognising the importance of creating the right settings for our start-up ecosystem in the Australian context, in order to secure the future of our gazelles here in Australia and in turn secure our position on the global innovation map and with that our country’s economic future.
The federal government has outlined the second and third waves of its National Innovation and Science Agenda. However, Tanchel warns that Australia cannot rely purely on the government to create a globally competitive tech ecosystem for Australia.
“We all have to play our part,” he said.
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