In 2002, Austria introduced a refun

In 2002, Austria introduced a refundable R&D tax credit (R&D premium) at a credit rate of 3%. Compared to the previous R&D tax allowance (abolished in 2011), this new tax credit implied a lower R&D tax subsidy rate for profitable firms but was more generous for loss-making firms due to the refundability of excess claims in case of insufficient tax liability. As a result of this refundability provision, implied marginal R&D tax subsidy rates coincide for profitable and loss-making firms, independent of their size, from 2002 onwards. The rate of the R&D premium increased in several instances, from initially 3% to 5% in 2003, to 8% in 2004, 10% in 2011, 12% in 2016, and 14% in 2018. Since then, it remained unchanged until 2020. With the increase in the rate of the R&D premium in 2011, the implied marginal R&D tax subsidy rate available to firms under the R&D premium surpassed the R&D tax subsidy rate available to profitable firms under the previous R&D tax allowance.