Accompanying Evaluation of the Tax-Based Research Funding Scheme in Germany

Tasks

As of 1 January 2020, the Federal Government has introduced R&D tax incentives. By promoting research through tax incentives, the Federal Government intends to increase the share of R&D investments in Germany‘s gross domestic product to 3.5% by 2025 and hopes to supplement the existing project funding scheme. In particular, the new tax incentives should strengthen R&D capabilities and R&D investments by small and medium-sized enterprises (SMEs). The new law intends to support Germany‘s innovative capacity and to increase tax attractiveness for research-oriented firms. 

This project focuses on an accompanying and ex-post evaluation of the new tax incentive scheme with respect to its desired effects. It is implemented on behalf of the Federal Ministry of Finance based on the evaluation plan approved by the European Commission in the period 2022 to 2025. Due to the accompanying character, there is an ongoing examination of implementation processes, target group outreach, as well as an in-depth analysis of the effects in the target groups and for Germany as a business location. This is implemented methodically using a wide-ranging mix of qualitative and quantitative (econometric) methods. The accompanying analyses represent intermediate steps to evaluate the effects of the new law, preparing a concluding analysis in 2025.

This project is realised in collaboration with the Austrian Institute for SME Research and the Austrian Institute of Economic Research (WIFO).