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“Austria as the Innovation Leader”– New Government Program Will Attract More Foreign Investors

© BKA

We have summarized the most important aspects of the government program for you:

1. Tax relief for companies and enhanced flexibility of working hours

Both Austrian and foreign companies will profit from the announced restructuring of Austria’s tax policies. The reduction of the corporate income tax, especially on retained earnings and with respect to the minimum corporate tax, as well as the decrease in non-wage costs (e.g. reduction of employer contributions and accident insurance) are at the forefront of the proposed measures. On balance, the overall burden of taxes and levies should be cut to 40 percent, accompanied by a simultaneous simplification of tax regulations.

Flexible working hours will be made possible as a means of strengthening the business location. The daily limit will be set at twelve hours and the maximum number of hours per week at 60 hours. In the future, an average weekly working time of more than 48 hours will continue to be prohibited. In this way, working hours will be more effectively adjusted to the respective order situation, downtimes and idle times of plants will be reduced and better compatibility of professional and family responsibilities as well as leisure time activities will be ensured.    

2. Digitalization and streamlining of bureaucracy

These measures will be supported by a reduction of bureaucracy and regulations pertaining to companies. For example, the Trade Regulation Act will be subject to an extensive reform and be subdivided into a “Company Qualification Act” (providing access to commercial entrepreneurship) based on quality and qualifications (i.e. the dual education system) and unified regulations on industrial plants while adapting laws to reflect the requirements imposed by the digital age. At the same time, digitalization in the public administration is to be further expanded, relying on eGovernment to simplify access to information and improve the overall service orientation. Administrative procedures are to be carried out digitally. In addition to a digitalization of the public administration, the fields of education, business and security are to be increasingly digitized. Moreover, a modern infrastructure should ensure that Austria serves as a trailblazer in digitalization and emerge as an “innovation leader”. 

3. Dual education and immigration of qualified specialists to counteract the shortage of skilled personnel

The availability of qualified specialists plays an important role in international competition for investors. For this reason, the new Austrian government has defined the goal of further strengthening the internationally acclaimed dual education system and the training of specialized staff, e.g. by a stronger emphasis on MINT subjects (mathematics, information technology, natural sciences and technology) in schools. Furthermore, education and training should be more closely oriented to the needs of the business community, and the cooperation of Austrian schools, universities, companies and international educational facilities should be intensified by implementing joint education programs. The controlled immigration of qualified personnel is designed to give the Austrian labor market additional means to counteract the shortage of skilled employees.

4. Targeted funding of corporate research

All in all, Austria is to be strengthened as the R&D headquarters of internationally operating companies. The government intends to increase public sector research expenditures each year. The objective is to achieve a research to GDP ratio of 3.76 percent. The current research ratio is 3.09 percent, the second highest in all of Europe. At the same time, the government will continue the existing research, technology and innovation strategy. Priorities include:

  • Implementation of the life sciences strategy
  • Further development of the microelectronics industry (“Silicon Austria”)
  • Strengthening of the automobile component supplier industry
  • Continuation of initiatives in the fields of battery production and quantum computer technology
  • Focus on 5G flagship projects  
  • Ambient assisted living
  • Expansion of energy research

 

For more detailed information have a look at the Regierungsprogramm (Government Program).

 

 

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