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In response to Ed Husic's proposal to reduce corporate taxes to encourage investment in artificial intelligence (AI) and automation within Australia's advanced manufacturing and technology sectors, CEOs from leading AI and manufacturing firms have shared their perspectives on the potential impacts.
Robert Yearsley, CEO and Co-founder of ARIA, an Australian company that has developed a groundbreaking device designed to help blind individuals perceive their surroundings through sound, expressed optimism about the proposal. He believes this tax policy shift could significantly influence his company's investment strategies. ARIA's device, which resembles a pair of sunglasses, uses advanced machine vision and AI systems to interpret visual data and convert it into audio signals, providing a sense of vision through sound.
Yearsley commented, "My company develops advanced Augmented Reality and Artificial Intelligence technologies in the medical device sector, which are high-value and low volume in nature. This policy shift would change the calculus on how much, and how fast we can invest in the manufacturing of more complex components here in Australia."
He added that the current manufacturing strategy involves deciding what gets built locally versus in Asia. "This policy, if enacted, would make it worthwhile to shift the balance of manufacturing (and value) onshore. The knock-on benefit is that it would take us three years rather than four to achieve optimal manufacturing complexity, creating and keeping more value onshore and helping drive business into the local supply chain."
Yearsley also highlighted the importance of modernising the existing industrial manufacturing base to better compete and service mature sectors. He acknowledged similarities between Husic's proposal and Germany's successful investment in robotics and AI, noting, "Ed is right to call out Germany's model of investment into robotics and AI and how this revitalised their industrial base—we can learn a lot from what they have achieved."
Dario Valenza, Founder of Carbonix, which specialises in precision uncrewed aerial systems (UAS) for large-scale data capture, provided a slightly different perspective. Carbonix's drones, equipped with advanced multi-sensor technologies, offer a safer, more efficient, and cost-effective alternative to traditional aircraft surveillance, significantly reducing environmental impact while enhancing data accuracy and operational efficiency for sectors like mining and energy.
Valenza underscored the challenges faced by innovative tech companies in transitioning from initial research and development to large-scale adoption. "During this critical phase, startups often aren't profitable and rely heavily on seed investments and reinvesting any revenues," he explained.
He cautioned that while a lower corporate tax rate may not directly impact early-stage startups, there could be indirect benefits. "Indirect benefits could arise from reducing input costs, as tax savings by suppliers might be passed on, lowering the cost of goods and doing business," Valenza noted. He also stressed the importance of governmental support in reducing state payroll tax and employee PAYG, which are substantial costs for businesses at all stages.
Valenza also suggested broader and more frequent incentives, changes to the R&D tax incentive scheme, and simpler government procurement processes to facilitate quicker adoption of new technologies. "Reducing costs by lowering tax and administrative burdens is preferable to navigating a complex tax and regulatory regime and seeking grants," he added, emphasising the need to streamline regulatory processes to reduce compliance costs.
Both executives are optimistic about Husic's proposal's potential positive impacts, though they emphasised that a multifaceted approach, including tax reform and reductions in administrative and regulatory burdens, would be essential in fostering a stronger environment for technological innovation in Australia.
