Oct 2016 International Business Times

Cochlear has threatened to move out its research and development facility in Australia because of cuts to tax incentives. The incentive amounts to about $10 million yearly. The budget savings bill in Australia could cut the tax concessions, Rick Holliday-Smith, chairman of the company, told shareholders during Cochlear’s annual meeting. He says the effect of those decisions could be fully understood only over the long term. On the first year, the tax policy would have little or no impact on the company, but over time, Cochlear would feel the loss of an increasing amount of research investments to overseas jurisdiction. The firm spends an average of $143 million, or 12 percent of its sales revenue on R&D, News.com.au reports.

While the firm generated 95 percent of its revenue overseas, over 75 percent of its tax was paid in Australia, the chairman says. He promises that Cochlear would continue to vigorously promote a globally competitive R&D tax concession regime in Australia.“Australia needs leaders in export- oriented businesses, and Australia should encourage research-oriented companies like Cochlear that are involved in advanced manufacturing,” Holliday-Smith says.

He also announced that Chris Smith, CEO and president of Cochlear, would return to the US after
serving as CEO of Cochlear since September 2015. The change is for family reasons.  Cochlear posted $1.158 billion revenue for 2016, while net profit was $188.9 million, Business
Insider Australia reports.