Making R&D tax credit conditional on dividend payment criteria: a microsimulation analysis[Conditionnalité du crédit d'impôt recherche à un critère de versement de dividendes : un exercice de microsimulation]

Based on a microsimulation analysis over the period 2009-2019, this note presents the results of different scenarios for making the French R&D tax credit (CIR - Crédit Impôt Recherche) conditional on a diviend payment criterion. It shows that 27% of companies declaring R&D expenditure for the CIR in a given year pay dividends to their shareholders. Furthermore, 14% of companies declaring R&D expenditure eligible for the CIR increased their dividends payments in the same year. Depending on the scenario adopted, the introduction of a condition on the non-payment of dividends or the absence of an increase in payments could yield between 1 and 2.1 billion euros (i.e. between 16 and 36% of the total annual R&D tax credit claim).