On January 1st, 2020, the new German law on tax incentives for research and development entered into force. By introducing a new tax incentive for conducting research, Germany follows the international trend on fostering domestic research efforts. Start-ups – which are economically defined by a high degree of innovativeness – regularly conduct research to develop innovative products and services. Hence, they often benefit from tax concessions for research efforts. Alexander Moßhammer analyzes the effects of national differences in the tax treatment of research expenses on a start-up’s location decision and discusses the necessity for an EU-wide standardization of tax research benefits.
