New Zealand R&D Tax Incentive Crosses $10 Billion Investment Mark

According to Simmonds, increased investment in research helps businesses develop new products, improve technologies, create higher-value jobs and expand New Zealand's knowledge-based economy.

New Zealand businesses have now invested more than $10 billion in research and development (R&D) through the Government's Research and Development Tax Incentive (RDTI), marking a major milestone for the country's innovation sector. Science, Technology and Innovation Minister Penny Simmonds said the achievement reflects growing confidence among businesses to invest in new ideas, technologies and products that can strengthen the economy.

The latest figures also show increasing participation from small businesses, with this year recording the highest number of new enrolments since 2021 following stronger outreach and support efforts led by the Ministry of Business, Innovation and Employment (MBIE).

Faster Growth Highlights Rising Business Confidence

Simmonds said the pace of growth under the RDTI has accelerated significantly since the programme began. It took around three years for businesses using the scheme to reach the first $1 billion in supported R&D activity, while the jump from that point to $10 billion happened in fewer than four years.

The latest application round, which closed on 30 June, has produced record application numbers. More businesses signed up for the scheme this year than in any year since 2021, with most of the new participants being small businesses.

The Government credits the strong response to targeted engagement campaigns, improved guidance materials and one-on-one support for businesses. The transfer of RDTI services from Callaghan Innovation to MBIE has also expanded outreach efforts across the country, making it easier for smaller firms to access the programme.

Independent Review Shows Strong Economic Returns

An independent evaluation completed in 2025 found the RDTI is delivering significant economic value. The study estimated that every dollar of tax incentive support encourages businesses to invest an additional $1.40 in research and development beyond what they would have spent without the scheme.

The evaluation also found the programme had generated around $1.8 billion in additional R&D investment and delivered an estimated $6.7 billion in economic benefits for New Zealand by 2025. Government officials say those figures have continued to grow over the past year as more businesses joined the scheme.

According to Simmonds, increased investment in research helps businesses develop new products, improve technologies, create higher-value jobs and expand New Zealand's knowledge-based economy.

Budget Changes to Improve Cash Flow for Businesses

The Government plans to make the RDTI even more attractive, particularly for small and medium-sized businesses carrying out research and development. As part of Budget 2026, it announced that eligible businesses will receive in-year tax credit payments, allowing them to access financial support sooner instead of waiting until the end of the tax year. The earlier payments are expected to improve cash flow, making it easier for businesses to continue investing in innovation and commercialising new ideas.

Simmonds said the milestone demonstrates what can be achieved when government support and private sector investment work together. She added that the RDTI will continue to play an important role in helping New Zealand businesses compete internationally while building a more productive, resilient and innovation-driven economy.