Brendan Griffin (Kerry South, Fine Gael)
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364. To ask the Minister for Jobs, Enterprise and Innovation for the information available on the planned knowledge development box initiative, as referred to in budget 2016; and if he will make a statement on the matter. [38025/15]

Richard Bruton (Dublin North Central, Fine Gael)
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A key objective of the Action Plan for Jobs process, which this Government commenced in 2012, was to rebuild our economy based on enterprise and entrepreneurship, talent, innovation and exports and provide a solid foundation for future growth. The enterprise sector has led the economic recovery, with our enterprises and entrepreneurs innovating, developing and improving their products and services to meet the needs of customers in markets across the globe The goal of this Government has been to replace all of the jobs lost during the economic crisis and deliver sustainable full employment by the end of 2018. This whole of Government effort has been integrated into the Action Plan for Jobs process which aims to strengthen the enterprise base, support entrepreneurship, improve competitiveness and support regional development. Since the launch of the first plan in Q1 2012, 126,000 more people are at work - exceeding the original target of an additional 100,000 jobs by 2016.

The recovery in jobs and exports to date is in large part due to the considerable improvements in the business environment for enterprise that have taken place in recent years. The measures announced by the Minister for Finance in Budget 2016 last month will further strengthened the attractiveness of Ireland as a place for innovation, entrepreneurship and investment – delivering sustainable job creation and growth. A competitive, innovative enterprise base is at the core of Ireland’s future economic development and growth.

Ireland is the first country world-wide to offer an OECD compliant Knowledge Development Box (KDB) offering certainty to global and Irish owned enterprises. The OECD nexus approach sets out the principles and guidelines under which income arising from IP assets can qualify for a lower rate of tax under a KDB initiative. Ireland’s KDB rate is 6.25 percent (half of the corporation tax rate of 12.5 percent) and is internationally competitive.

The Knowledge Box, as announced in the 2016 Budget speech, will support and encourage investment in research and development in Ireland and the increased the protection and exploitation of intellectual property arising.

The Finance Bill also allows for the introduction of a provision pertaining to ‘Companies with income arising from intellectual property of less than €7,500,000’ which will be introduced during 2016 when the necessary legislation to give it effect is enacted and will be of direct benefit to companies of a relatively lower scale, with global income of less than €50 million. [Section 30, 769R]

The other eligible assets sought are reflected in the Finance Bill:

i. Copyrighted software permitted under the OECD guidelines is reflected under the computer program definition.

ii. Supplementary protection certificates and paediatric protection under EU regulations.

iii. Plant rights under EU regulation.

iv. Breeders’ rights within the meaning of Plant Varieties (Proprietary Rights) Act 1980.

Information and advisory notes will be available from Revenue in due course.

The KDB complements the existing suite of initiatives and supports available to companies that undertake R&D activities in Ireland across the lifecycle of research and development – including R&D tax credits, RD&I grant supports, support for technology acquisition (S291A), significant state investments in National Research Centres and knowledge transfer infrastructures, and advisory supports for accessing Horizon 2020 funding – providing a competitive proposition for business investment.