Patent Box Evaluation

This document describes an evaluation of the UK Patent Box policy, which offers a lower corporate tax rate on profits from intellectual property (IP) to incentivize local investment and commercialization of patents. The policy's effectiveness in stimulating investment is assessed using a micro-econometric approach, specifically a difference-in-difference (DiD) analysis comparing firms utilizing the patent box to a control group. The evaluation finds that the policy potentially increases investment by firms, with a 10% rise observed in those using the Patent Box. However, the study notes limitations such as potential self-selection bias, the phased implementation of the policy, and the need for further analysis on the policy's effects on skilled employment. Despite these caveats, the evidence suggests that the UK Patent Box encourages firms to increase their investment in the UK. **This summary was written by an AI model and therefore should not be considered a definitive summary of the report. If you are aware of inaccuracies, please email evaluation.registry@cabinetoffice.gov.uk.**

Description

• Lead department: HM Revenue & Customs (HMRC)
• Evaluation stage: A complete evaluation report
• Other departments: No other departments listed
• Evaluation types: Impact evaluation
• Impact methods: Quasi-experimental method
• Quasi-experimental methods: Difference-in-difference
• Grant information: This intervention is not distributing funding via a grant
• Government Major Project information: This intervention is not a major project
• Policies: No policies provided

Event Dates

• Event Name: Publication of final results
• Event date: October 2020

Evaluation Costs

• Cost: Not provided

Evaluation sharing

• Link(s) to published report(s): Yes
• Links to evaluation plans: No link provided
• Links to published evaluations (DEBUGGING): No final report link found.
• Findings: Not provided
• Permission to share confirmed: Yes