THE existing Productivity and Innovation Credit (PIC) scheme should be tiered to promote productivity adoption in the first three years, and innovation and internationalisation in the next five years, said KPMG on Wednesday.
This would boost the scheme's efficacy and sustainability in the long run, said KPMG head of tax Tay Hong Beng.
"Rather than just having a broad incentive to drive productivity across the board, we should split it up (and have the PIC) become more comprehensive and targeted in its approach," said Mr Tay.
KPMG suggests that for the first three years, higher cash payout limits and the flexibility to combine PIC caps across productivity-driven activities can be considered.
Following the first phase, support for the innovation side of things should come into focus. This includes internationalisation activities - such as market feasibility studies and brand development efforts - and the flexibility to combine PIC caps across innovation-driven activities like intellectual property registration and acquisitions.