Data shows that the Government’s R&D tax credit is directly driving new investment, even as companies contend with geopolitical uncertainty, international tax changes and competitive pressures
The Industry Research and Development Group (IRDG) and KPMG have released the 2026 Ireland Innovation Index, which is the fourth annual report gathering detailed responses from companies actively engaged in innovation across Ireland.
This year’s findings show that, following a jump from 30pc to 35pc in the previous budget, the R&D tax credit has led to a significant boost in R&D activity. Almost 70pc of the 587 organisations who contributed their data said they have increased R&D spend over the past three years and 77pc expect to increase investment over the next three years.
58pc of businesses explain that they are funnelling the extra 5pc credit directly into currently existing R&D projects while an additional 57pc said that it will go towards supporting completely new R&D activity. Nearly 40pc of survey participants said the enhanced incentive will support them hiring or retaining dedicated R&D staff.
IRDG’s and KPMG’s research also highlighted the role of the tax credit in attracting and maintaining R&D activity and jobs in Ireland, with more than half (54pc) of contributing multinational companies saying that without the credit, 10pc or less of their R&D would take place in Ireland.
