News release

Revenue minister announces results of Scientific Research and Experimental Development (SR&ED) conference

VANCOUVER, June 30, 1998...The Honourable Herb Dhaliwal, Minister of National Revenue and M.P. (Vancouver South-Burnaby), today announced that Revenue Canada will implement an action plan to improve the Scientific Research and Experimental Development (SR&ED) Program. The announcement was made following an SR&ED conference that ended Saturday in Vancouver.

The two-day conference, entitled "Building Partnerships", brought together over 70 representatives from industry associations and individual companies to work with government officials to improve the SR&ED program, and to ensure continued industry participation in its administration.

Based on the proposals of the conference workshops, Mr. Dhaliwal announced that Revenue Canada will work towards implementing:

• a self-contained national organization for the SR&ED program;
  
  
• measures to reduce the number of formal disputes, based on improved communication, enhanced education and secondary reviews, as needed;
  
  
• development of guidelines, codes, and standards on an industry-sector basis to reflect industry differences; and
  
  
• a streamlined approach for processing claims, based on improved risk management.

The Minister also announced that a review committee will be established to ensure the implementation of these measures. Mr. Dhaliwal expressed his satisfaction with the results of the conference and noted that they were consistent with many of the SR&ED initiatives that his Department has put in place or is in the process of implementing.

The Minister also emphasized the value of a working partnership with industry to make improvements to the SR&ED program. "The broad spectrum of industry involvement in these proceedings reflects a commitment on the part of industry to develop a working partnership with my Department for the betterment of the SR&ED program. This is a commitment we share with industry," said Mr. Dhaliwal.

Mr. Dhaliwal also stated that "we are confident that the action plan that was jointly developed with industry will improve the administration of the SR&ED program."

The SR&ED program provides broadly based support for research and development in every industrial sector in Canada. In 1997, approximately $1.3 billion in assistance was provided to over 11,000 participants through the program, and the number of claimants has continued to grow at a rate of 13% a year since the beginning of the program in 1985.

"The SR&ED program is a powerful tool in sustaining Canada's competitiveness. If government can create an environment that allows Canadian industry to flourish, then we all win," concluded Mr. Dhaliwal.

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Note

The conference was sponsored by Revenue Canada and several industry associations. It was organized in part to respond to the recommendations of a report entitled "The Federal System of Scientific Research and Experimental Development Tax Incentives: Reviewing the Partnership Through Consensus, Consistency and Predictability." The report was prepared by the Canadian Advanced Technology Alliance (CATA) in collaboration with the following industry associations:

Aerospace Industries of Canada (AIAC)

Alliance of Manufacturers and Exporters Canada (AMEC)

Canadian Chemical Producers Association (CCPA)

Canadian Manufacturers of Chemical Specialties Association (CMCSA)

Canadian Vehicles Manufacturers' Association (CVMA)

Information Technology Association of Canada (ITAC)

B.C. Technology Industries Association (TIA)

For media information, contact:

Colette Gentes-Hawn
Revenue Canada
(613) 957-3522

31C/98