Boosting mergers and R&D

Faced with a sharp decline in mergers and acquisitions, the government is providing more generous tax incentives to encourage them. It also wants to reward companies that invest heavily in research and development, as well as angel investors that put up their own assets to finance startups and other small businesses in exchange for equity.

The draft bill presented to the cabinet Wednesday by Finance Minister Kostis Hatzidakis wants to encourage smaller businesses to merge. To this effect, it lowers the limit for merging businesses eligible for tax breaks to €100,000 from €125,000. And, to encourage research and development, spending on that activity can lead to a deduction in taxable income up to 315% - that is, over four times - the actual amount spent. The provision will especially target startups and collaboration with research centers and universities. In the latter case...