Impact assessment of innovation tax incentives in Brazil


  • Daniel Gama e Colombo Center for Legal and Economic Sciences, Federal University of Espirito Santo, Vitoria
  • Helio Nogueira da Cruz School of Economics, Business and Accounting of the University of São Paulo, São Paulo,



Impact assessment, Brazilian innovation policy, tax incentives


Purpose - This paper evaluates the effects of tax incentives on business innovation in Brazil that were established by Law 11,196/05 (the ‘Fiscal Incentives Law’) to test whether they have had a positive impact on beneficiary firms’ innovation input and output and on their performance.
Design/methodology/approach – The policy impacts are estimated using microdata on 13,706 firms available in the 2008 and 2011 editions of the Brazilian Innovation Survey (PINTEC) and by applying propensity score matching with difference-in-differences.
Findings - The results suggest a positive and statistically significant impact of the policy on research and development (R&D) expenditures (average of approximately US$ 264,000 in 2011), the number of research staff (average of five researchers), and total employment (approximately 5% of the beneficiary firms’ mean size). However, no impact was found on the overall spending on innovative activities, the percentage of sales and exports from new products, net revenue, or net revenue per employee.
Practical implications – The findings provide empirical support in favor of tax incentives as a policy tool to boost business innovation in the country. However, the absence of significant effects on innovative activities expenditures and on most indicators of innovation output and firms’ performance reveals shortcomings of the policy that need to be addressed.
Originality/value – The study complements and advances the findings of previous studies by assessing policy impact on total innovative activities expenditures and on innovation output and firm performance.


Não há dados estatísticos.


AGRAWAL, A., ROSELL, C. & SIMCOE, T. 2020. Tax credits and small firm R&D spending. American Economic Journal: Economic Policy, 12, 1-21.

ARALICA, Z. & BOTRIC, V. 2013. Evaluation of Research and Development Tax Incentives Scheme in Croatia. Ekonomska Istrazivanja-Economic Research, 26, 63-80.

ARAÚJO, B. C. 2010. Incentivos fiscais à pesquisa e desenvolvimento e custos de inovação no Brasil.

AVELLAR, A. P. 2008. Avaliação do impacto do PDTI sobre o gasto em atividades de inovação e em P&D das empresas industriais. Políticas de incentivo à inovação tecnológica no Brasil. Brasília: Ipea.

AVELLAR, A. P. M. D. & OLIVEIRA, F. C. B. 2009. O comportamento do sistema nacional de inovação brasileiro no período de 2000 a 2007. Revista Economia Ensaios, 23.

BARRICHELLO, A., DOS SANTOS, E. G. & MORANO, R. S. 2020. Determinant and priority factors of innovation for the development of nations. Innovation & Management Review.

BLANDINIERES, F., STEINBRENNER, D. & WEIß, B. 2020. Which design works? A meta-regression analysis of the impacts of R&D tax incentives. A Meta-Regression Analysis of the Impacts of R&D Tax Incentives, 20-010.

BLOOM, N., CHENNELLS, L., GRIFFITH, R. & VAN REENEN, J. 2002. How has tax affected the changing cost of R&D? Evidence from eight countries. The Regulation of Science and Technology. Springer.

BLUNDELL, R. & COSTA DIAS, M. 2000. Evaluation methods for non‐experimental data. Fiscal studies, 21, 427-468.

BRAZILIAN FEDERAL REVENUE OFFICE 2020. Relatórios - Dados Setoriais por CNAE e UF 2016 a 2018 [Sectoral Data 2016-2018]. In: BRAZILIAN FEDERAL REVENUE OFFICE (ed.). Brasilia.

BRAZILIAN MINISTRY OF SCIENCE TECHNOLOGY AND INNOVATION 2015. Brasil: Dispêndio nacional em pesquisa e desenvolvimento (P&D) em valores correntes, em relação ao total de P&D e ao produto interno bruto (PIB), por setor institucional, 2000-2013 [Brazil: National spending on R&D in current values, as a share of total R&D and GDP, per institutional sector, 2000-2013]. In: BRAZILIAN MINISTRY OF SCIENCE TECHNOLOGY AND INNOVATION (ed.). Brasilia.

BRAZILIAN MINISTRY OF SCIENCE TECHNOLOGY AND INNOVATION 2016. Lei do Bem - Utilização dos Incentivos Fiscais à Inovação Tecnológica – Ano Base 2014: Capítulo III da Lei do Bem – Lei Nº 11.196/05 [Use of the incentives of the Fiscal Incentives Law: Chapter III - Report - 2014]. Brazilian Ministry of Science, Technology and Innovation.

CALZOLAIO, A. E. & DATHEIN, R. Políticas fiscais de incentivo à inovação: uma avaliação da Lei do Bem. Encontro de Economia da Região Sul, 2012.

CAPPELEN, A., RAKNERUD, A. & RYBALKA, M. 2007. The effect of R&D tax credits on firm performance. Report. Oslo-Kongsvinger: Statistics Norway.

CHEN, Z., LIU, Z., SERRATO, J. C. S. & XU, D. Y. 2018. Notching R&D investment with corporate income tax cuts in China. National Bureau of Economic Research.

CZARNITZKI, D., HANEL, P. & ROSA, J. M. 2011. Evaluating the impact of R&D tax credits on innovation: A microeconometric study on Canadian firms. Research Policy, 40, 217-229.

CZARNITZKI, D. & HUSSINGER, K. 2018. Input and output additionality of R&D subsidies. Applied Economics, 50, 1324-1341.

DECHEZLEPRÊTRE, A., EINIÖ, E., MARTIN, R., NGUYEN, K.-T. & VAN REENEN, J. 2016. Do tax incentives for research increase firm innovation? An RD design for R&D. National Bureau of Economic Research.

DEHEJIA, R. H. & WAHBA, S. 2002. Propensity score-matching methods for nonexperimental causal studies. Review of Economics and Statistics, 84, 151-161.

EY 2020. Worldwide R&D Incentives Reference Guide.

FAZIO, C., GUZMAN, J. & STERN, S. 2019. The impact of state-level R&D tax credits on the quantity and quality of entrepreneurship. National Bureau of Economic Research.

FREEL, M., LIU, R. & RAMMER, C. 2019. The export additionality of innovation policy. Industrial and Corporate Change, 28, 1257-1277.

GAULT, F. 2013. Innovation indicators and measurement: challenges. In: GAULT, F. (ed.) Handbook of innovation indicators and measurement. Edward Elgar Publishing.

GUCERI, I. 2018. Will the real R&D employees please stand up? Effects of tax breaks on firm-level outcomes. International Tax and Public Finance, 25, 1-63.

HALL, B. H. 2020. Tax Policy for Innovation. Innovation and Public Policy. University of Chicago Press.

HALL, B. H. & VAN REENEN, J. 2000. How effective are fiscal incentives for R&D? A review of the evidence. Research Policy, 29, 449-469.

HILL, C. T. 2013. US innovation strategy and policy: an indicators perspective. Handbook of Innovation Indicators and Measurement. Edward Elgar Publishing.

HUGHES, R. A., HERON, J., STERNE, J. A. & TILLING, K. 2019. Accounting for missing data in statistical analyses: multiple imputation is not always the answer. International journal of epidemiology, 48, 1294-1304.

IBGE 2010. Pesquisa de inovação tecnológica: 2008 [Industrial Innovation Survey 2008]. Rio de Janeiro: IBGE.

IBGE 2013. Pesquisa de inovação tecnológica: 2011 [Industrial Innovation Survey 2011]. Rio de Janeiro: IBGE.

IBGE 2020. PINTEC - Pesquisa de Inovação 2017 [Innovation Survey 2017], Rio de Janeiro, Brazilian Institute of Geography and Statistics,.

IFS 2015. A Study on R&D Tax Incentives-Final report. The Hague: Directorate General Taxation and Customs Union, European Commission.

IVUS, O., JOSE, M. & SHARMA, R. 2021. R&D tax credit and innovation: Evidence from private firms in india. Research Policy, 50, 104128.

KANNEBLEY JR, S., ARAÚJO, B. C., MAFFIOLI, A. & STUCCHI, R. 2013. Productive Development Policies and Innovation Spillovers through Labor Force Mobility: The Case of the Brazilian Innovation Support System. IDB-WP. Inter-American Development Bank.

KANNEBLEY JR, S. & SILVEIRA PORTO, G. 2012. Incentivos fiscais à pesquisa, desenvolvimento e inovação no Brasil: uma avaliação das políticas recentes. IDB-DP. Inter-American Development Bank.

LANE, N. 2020. The new empirics of industrial policy. Journal of Industry, Competition and Trade, 20, 209-234.

LUCKING, B., BLOOM, N. & VAN REENEN, J. 2019. Have R&D Spillovers Declined in the 21st Century? Fiscal Studies, 40, 561-590.

MAZZUCATO, M. & PENNA, C. 2016. The Brazilian innovation system: a mission-oriented policy proposal, Brasilia, CGEE.

MINISTRY OF ECONOMICS 2017. Empresas Brasileiras Importadoras e Exportadoras [Importing and Exporting Firms - Dataset]. In: ECONOMICS, M. O. (ed.). Brasília.

NILSEN, Ø. A., RAKNERUD, A. & IANCU, D.-C. 2020. Public R&D support and firm performance: A multivariate dose-response analysis. Research Policy, 49, 104067.

OECD 2015. The Measurement of Scientific, Technological and Innovation Activities Frascati Manual 2015 Guidelines for Collecting and Reporting Data on Research and Experimental Development: Guidelines for Collecting and Reporting Data on Research and Experimental Development, OECD Publishing.

OECD 2016. OECD Science, Technology and Innovation Outlook 2016, OECD Publishing.

OECD 2020. OECD R&D tax incentives database, 2020 edition [report]. Paris: OECD Publishing. Available at <>.

OECD & EUROSTAT 2018. Oslo Manual 2018: Guidelines for Collecting, Reporting and Using Data on Innovation, Paris, OECD Publishing.

OGNYANOVA, D. 2017. R&D tax incentives: How to make them most effective? Working Paper Series. Brussels: European Commission Directorate-General for Research and Innovation.

RAO, N. 2016. Do tax credits stimulate R&D spending? The effect of the R&D tax credit in its first decade. Journal of Public Economics, 140, 1-12.

ROSENBAUM, P. R. 2012. Design of Observational Studies, Springer New York.

SANTOS, J. B. 2019. Knowledge-intensive business services and innovation performance in Brazil. Innovation & Management Review.

SHIMADA, E. 2014. Efetividade da lei do bem no estÍmulo ao investimento em p&d: Uma anÁlise com dados em painel. Master's, Universidade de São Paulo.

SUZIGAN, W. & FURTADO, J. 2006. Política industrial e desenvolvimento. Brazilian Journal of Political Economy, 26, 163-185.

TIAN, B., YU, B., CHEN, S. & YE, J. 2020. Tax incentive, R&D investment and firm innovation: Evidence from China. Journal of Asian Economics, 71, 101245.

VAN REENEN, J. 2020. Innovation policies to boost productivity. The Hamilton Project, Brookings Institution, Washington, DC.

ZÚÑIGA‐VICENTE, J. Á., ALONSO‐BORREGO, C., FORCADELL, F. J. & GALÁN, J. I. 2014. Assessing the effect of public subsidies on firm R&D investment: a survey. Journal of Economic Surveys, 28, 36-67.




Como Citar

Colombo, D. G. e ., & Cruz, H. N. da. (2023). Impact assessment of innovation tax incentives in Brazil. INMR - Innovation & Management Review, 20(1), 28-42.