UK’s competitive tax regime makes it attractive for life sciences, says BIA’s CEO
In his talk during the BIO International Convention, the CEO of the UK BioIndustry Association (BIA), Steve Bates, discussed how the UK’s fiscal environment has helped to make the country the most productive science base in the G7.
Particularly drawing on the country’s attractive tax regime, which combines low rates of tax, innovation incentives, significant tax benefits and comprehensive global treaty networks, the UK is attractive as a hub for life sciences. Moreover, the tax environment is immune to Brexit as it is a UK government competence, the BIA stated in a press release.
“The fiscal environment in the UK is better today for bioscience than the USA could be under any of President Trump’s proposed changes,” Bates stated. “This has contributed to the UK becoming Europe’s hub for life sciences, with a deep talent pool and the most productive science base in the G7.
“The UK has more than 5,600 companies to partner with homed in a country with a highly competitive and efficient tax regime. BIA research shows that the UK continues to gain ground on the larger global clusters and the UK’s continued support for science — both in terms of investment and societal support — contrasts dramatically with US policy that seems to be heading in the opposite direction.”
Some of the key benefits of the UK tax environment for life sciences, listed by the BIA are as follows:
- 17% headline tax rate by 2020
- R&D relief 25–35 p/£ for SMEs and 11 p/£ for large businesses
- Significant clinical manufacturing expenditure eligible for the R&D incentive either at 33 p/£ or 11 p/£
- Tax losses — these can be carried forward indefinitely and offset against future profits
- Patent Box tax rate at 10% on profits attributable to patents
When combining the low tax rates and patent box the BIA state there is an effective tax rate of 11–13%.