Back in July 2017, the Canadian Advanced Technology Association
(CATA) published its update on SR&ED. Most of us are aware that
in the 2012 federal budget, the federal government made cuts to the
SR&ED program, through changes to both tax credit rates and
eligibility rates for qualified SR&ED expenditures. These cuts
were expected to amount to a total of $1.3 billion from program
expenditures from 2014 to 2017, with a maximum annual reduction of
$500 million relative to 2012.
However, upon further examination, as per the Department of
Finance's 2017 Report on Federal Tax Expenditures, the
result is far in excess of the forecasted $1.3 billion cut. In
actuality, the change from 2011 to 2017 is double the forecasted
cut. This $2.6 billion cut decreases the overall program's
budget by approximately 50%! Based on CATA's analysis, the
Canada Revenue Agency (CRA) is spending more money on staff to
administer program compliance. This increase was up by 60% since
2005 or
