Subject Small and medium-sized enterprises play a special role in high-tech product manufacture and promotion. Therefore, additional tax incentives for small and medium-sized innovative enterprises should be an important area of government regulation. Objectives The study aims to investigate tax regulation of R&D in Russia and foreign countries, focusing on special conditions for small and medium-sized high-tech businesses. Methods In the course of the study, we reveal special conditions for small and medium-sized innovative businesses. Based on OECD statistics, we analyze the level of tax incentives for R&D. Results The paper identifies countries that apply tax incentives or direct funding for R&D. The State support to innovation is high enough in all of them, though developed countries do not have a single approach to incentives for knowledge-intensive SMEs. In Russia, the businesses conducting research and development also have government support. However, the values of 1-B index that characterizes the tax subsidy rate are low. This points to the lack of priorities for high-tech SMEs. Conclusions More significant tax incentives for small and medium-sized enterprises will have a beneficial impact oninnovation growth in Russia.
Keywords: corporate income tax, innovation, research and development, small and medium-sized business, tax credit
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