Doubts raised over ONS business R&D estimates

MPs told apparent increase in business research spending could be game-playing over tax credits

An apparent increase in business spending on R&D may actually be down to shady business advisers gaming the system to benefit from the HM Revenue and Customs R&D tax credit scheme, MPs have been told.

In September the ONS released revised estimates of business spending on R&D using what it labelled an “improved” methodology. These suggested that spending is about £15 billion per year higher than previously thought, and that the government may have already reached its long-term target to increase R&D spending to 2.4 per cent of GDP.