Australia must not "squander" the good management of the COVID-19 pandemic, homegrown tech giant Atlassian has told a parliamentary inquiry.
"We have never been a more attractive place for talented individuals to want to move to," director of global public policy David Masters told the financial and regulatory technology committee hearing on Friday.
"We should double-down on this moment to pitch ourselves to people with the skills that the Australian technology sector needs to grow."
Warning against governments' tendency to "tinker" with tax and company law, Mr Masters said the significant growth of the past five years in private equity financing has been built on a 20-year effort to stimulate interest in risk capital and new rules for early stage venture capital limited partnerships.
But Atlassian is concerned about confusion when dealing with the tax office around the federal research and development tax incentive and whether it applies to software investment.
The committee has heard from smaller companies who say the R&DTI measure is clunky and the risk of a retrospective tax ruling against them is too great to warrant engaging with the program.
"For Australia, that is capital that is being lost to our innovation system and for our companies that is a competitive disadvantage against emerging innovators elsewhere," Mr Masters said.
"In technology the market only respects innovation and it is the secret source of Atlassian's growth."
Atlassian, creator of Jira and Trello tools used by millions globally, including Australia's defence and home affairs departments, said its own investment in R&D has been consistently higher than its global peers.
"Ultimately, a new scheme for software innovation may be required that is unencumbered by legacy definitions of R&D that are more applicable to other sectors," he said.
The company has offered to bring together firms to meet with the tax commissioner within the next two months to nut out reforms, but Mr Masters acknowledged change would take time.
KPMG agrees that new tax rules for research and development are needed so that software spending qualifies for tax write-offs, while eftpos Payments Australia wants to protect a footprint of over two billion debit card transactions a year worth more than $300 million each day.
"Australia cannot afford a payments system where multinational schemes and global big tech make the rules and set the prices to their benefit at the expense of Australia's small businesses and consumers," eftpos chief executive Stephen Benton said.
Australian Associated Press