From the 29th November 2010 until 22nd February 2011, HMRC is consulting on the introducton of a ‘Patent Box’. This is an initiative where by a preferential corporate tax rate is applied to profits arising from patents; the rate suggested in the consultation document is 10%. The consultation, which also covers the role of R&D tax credits, addresses “the UK’s approach to the tax treatment of IP and innovation”. As reported by PharmaTimes, GSK Chief Exec considers the patent box to be "a bold and forward-thinking measure which builds on the UK’s strength as a global centre of excellence for science and R&D".
So here’s a quick question. If innovation is rewarded from the public purse via the patent box and R&D credits, why does it need to be rewarded again through reimbursement decisions or value-based pricing?