R&D Expenses Plus Deduction;r&d Investment And Innovation Performance

At the end of 2021,the video of "soul bargaining" between negotiators of the national medical insurance administration and enterprise representatives caused heated discussion.With the deepening of the reform of the national pharmaceutical policy,the actions of the national drug procurement and the adjustment of the pharmaceutical catalogue show the long-term development trend of the pharmaceutical industry in the future.In this context,the profit margin of a large number of generic drugs of pharmaceutical enterprises has been compressed,and the profitability of enterprises has been weakened.Therefore,in order to meet the requirements of the times,pharmaceutical enterprises must seize the opportunities and challenges,take innovation as the guidance and patent as the breakthrough,improve quality and efficiency,reduce production costs and seek space for their own development.However,the development of innovative drugs requires a lot of money and time,and it is difficult to see results in the short term.Therefore,high risk and uncertainty have become the biggest obstacle to the R&D and innovation of pharmaceutical enterprises.In 1996,R&D expenses plus deduction policy began to appear.After three stages of start,system and improvement,it was proposed to increase the pre tax deduction rate of R&D expenses plus deduction from 50% to 75% in 2018.This measure greatly encourages the self-confidence of enterprises in R&D investment.Through tax reduction and fee reduction,enterprises can improve the capital stock of enterprises and save R&D costs,so as to promote the development of enterprise innovation performance.In this context,taking Fosun Pharma as an example,this paper studies whether the R&D expense plus deduction policy plays a positive role in the enterprise by comparing the changes of R&D investment and innovation performance factors.Based on market failure theory,tax incentive theory and endogenous economic growth theory,this paper studies the theory to understand the reasons for the introduction of R&D expense plus Deduction Policy and the impact of tax preference on enterprises.Taking Fosun Pharma as a case company,after discussing the total R&D investment,R&D intensity and R&D personnel of the company at the present stage,this paper introduces the application of R&D expense plus deduction in Fosun Pharma,and carries out the impact of the policy on the company’s R&D activities and innovation performance.It is concluded that the addition and deduction of R&D expenses has saved Fosun Pharma a lot of expenses in income tax in recent years,and the year-on-year growth rate is considerable,especially after the increase of the addition and deduction rate of R&D expenses in 2018.In addition,the reduction of corporate income tax has greatly stimulated Fosun Pharma’s investment in R&D of innovative drugs.Such a large increase shows the positive effect of the R&D expense plus Deduction Policy.The expansion of R&D investment will inevitably lead to the increase of technology and product output for enterprises.However,due to the lag of tax preferential policies,the performance in patents and new products cannot be immediately prominent.However,generally speaking,from the number of patents and innovative drugs listed by Fosun Pharma over the years,it can be considered that there is a positive relationship between the addition and deduction of R&D expenses and innovation performance.On the one hand,the research of this paper can enrich the theory of the relationship among R&D expenses plus deduction,R&D investment and Innovation performance.On the other hand,it can also provide reference for the improvement of current preferential tax policies.