TaxCorporate TaxEU cross-border research projects to get tax break

EU cross-border research projects to get tax break

Large research projects to be exempted from VAT in tax breaks worth billions of pounds

Large cross-border research projects in Europe are set to enjoy multi-billion
euro tax breaks after EU industry ministers gave the go-ahead for a scheme which
will exempt them from value-added tax, the Financial Times reported.

The ministers, meeting on Friday in Brussels, agreed that so-called ‘European
Research Infrastructure Consortia’ could have the status of international bodies
and so fall outside the VAT net, the newspaper said.

To qualify as ERICs, projects will have to involve several member states,
have legitimate research objectives and be “non-economic” in nature, the FT
added.
Since VAT rates typically range between 15 and 25%, the savings for large
projects could be very significant.

Several dozen pan-European projects, involving about €18bn (£15.7bn) of
public money, have already been identified by national research ministers are
‘priority areas’ for collaborative scientific research, the FT said. These are
expected to be some of the immediate beneficiaries.

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