Venture Capital Tax Reforms in Australia and New Zealand
New Zealand Journal of Taxation Law and Policy, Vol. 11, No. 2, 2005
Posted: 25 Jan 2006
Australia and New Zealand have recently enacted tax and entity reforms aimed at increasing venture capital investment. This article examines the purpose and effect of these new measures in light of policy goals for subsidising venture capital and reveals the specific kind of venture capital investment sought to be subsidised by these reforms, one based on the dominant US model of private venture capital funds. The new rules will tend to favour later stage capitalisation of new enterprises and will tend to reward fund managers rather than directly rewarding the original developers and entrepreneurs in respect of intellectual property. The article discusses some significant differences between the Australian and New Zealand regimes and considers whether further, and differently targeted, reforms are possible or necessary to assist new innovative enterprises in Australia and New Zealand.
Keywords: venture capital, reform, Australia, New Zealand, subsidy, capitalisation, fund managers, intellectual property, innovative
JEL Classification: K00, K11, K34, K22
Suggested Citation: Suggested Citation