Governor Doyle Launches Innovate Wisconsin

New Tax Credits and Exemptions to Leverage Investment in Research and Development


 


MADISON – Governor Jim Doyle today announced a plan to help create jobs and grow the state’s economy by increasing investment in research and development. The plan, called Innovate Wisconsin, offers incentives for private businesses to focus on future breakthroughs.


 


“When it comes to research and development, our manufacturers are competing at the high end and already have a clear advantage over competitors around the country and the world,” Governor Doyle said. “To continue to stay ahead of the competition, Wisconsin’s manufacturers must invest more in research and development to improve existing products and develop new ones. Wisconsin has become a world-renowned center for research, particularly in the public sector. The next phase of Grow Wisconsin will do more to foster research in the private sector as well.”


 


Innovate Wisconsin is part of the next phase of Governor Doyle’s Grow Wisconsin agenda.  Research and development is important to a knowledge-driven economy and Governor Doyle has committed to making strategic investments that keep the state a leader. In the past five years, the state has committed to build some of the world’s leading public research institutions, including the translational research facility at the Medical College of Wisconsin and the Wisconsin Institutes for Discovery at the University of Wisconsin – Madison.


 


Spending on research and development was $2.7 billion in Wisconsin, or 1.23 percent of the state’s gross domestic economy in 2005. Nationally, states on average invested 1.65 percent of their economies in 2005 to research and development. Minnesota devoted more than twice as much of its economy to R&D than Wisconsin.


 


The Innovate Wisconsin plan will increase the state’s focus on research and development by:


 



  • Providing new Innovate tax credits – Companies that increase spending on research and development by 25 percent over their three-year average will receive a $1 tax credit for every $1 spent above this threshold. The tax credit a company can claim through this initiative is capped at 50 percent of its tax liability.

 



  • Sales tax exemption for research and development equipment – The sales tax exemption that applies to machines and equipment used in manufacturing will be extended to cover equipment used in research and development.

 



  • Property tax exemption – The equipment used in research and development will also be exempt from property taxes.