Symbol of the Government of Canada

Common menu bar links

Toronto Region Research Alliance

Submission — Toronto Region Research Alliance

Important note: The content of submissions and summaries is the sole responsibility of the person and / or organization having made a submission. The posting of this content does not indicate that the Panel supports or endorses it. Submissions and summaries are posted in the language provided without modification.

Submitter(s): Stewart, Walter

Summary: TRRA conducted an on-line survey of key business leaders among SMEs, large companies, and foreign controlled companies and circulated draft responses to a smaller number of business leaders for further comment to formulate answers to four of the Expert Panel's questions. Key findings:

  • SR&ED works extremely well for SME's eligible for refunds.
  • Among companies for whom SR&ED is important, satisfaction levels with the program are very high.
  • The value of SR&ED for those for whom it works must be retained.
  • SR&ED is less effective for large companies, particularly those that are foreign controlled.
  • R&D mandate from global parent companies to Canadian subsidiaries represents $2.7 billion annually to the Canadian economy. There is significant potential for growth. Government should consider program to support Canadian operations of multinationals in securing and growing global R&D mandates.
  • We received a number of comments like the following: The program needs to evolve – "Canada's program is no longer attractive enough to compete against other countries such as China, UK and Australia. Global companies compete against their own sister companies around the world and a non-refundable credit system is no longer providing that competitive edge." Government should regularly benchmark its support for R&D against support in competitor companies.
  • There is a very great difference between R&D and innovation. Canada's productivity gap is much more a consequence of failure to adopt productivity tools across the economy than it is a failure to invent.
  • 75% of Canadian business is unlikely to benefit from SR&ED because their activities are unlikely to benefit from scientific discovery. Innovation in services will be critical to improving productivity in Canada.

Full submission: PDF Version