2026/07/28 by Sónia Calado, Cláudia Maria Fileno Miranda Veloso, Cláudia Miranda Veloso +2
Economics, Econometrics and Finance · Business, Management and Accounting · #Innovation Policy and R&D #Corporate Taxation and Avoidance #Firm Innovation and Growth
paper · doi:10.1108/md-11-2025-3485
Purpose This study aims to investigate national-level patterns and structural determinants of SIFIDE usage in Portugal (2006–2023), with the aim of evaluating the effectiveness and equity of this flagship research and development (R&D) tax incentive. The study examines how firm type, sector and competition shape access to fiscal support, linking these patterns to firms’ strategic decision-making and managerial decision environments. Design/methodology/approach Using official annual aggregates, the study applies descriptive statistics, correlation analysis and linear regressions. Nine hypotheses are tested that connect application behaviour, sectoral dynamics and fiscal-innovation outcomes, with particular attention to small and medium-sized enterprises (SMEs) and microenterprises. Findings Although SMEs represent 99% of the Portuguese business landscape, large enterprises capture the highest fiscal benefits under SIFIDE. Microenterprises (96%) receive only residual support due to lower investment capacity, which results in limited tax credits. This distribution favours already strong firms and perpetuates structural asymmetries. Competition pressures also reduce average support per project (and, among large firms, approval efficiency), underscoring the strategic nature of budgeting and timing decisions under fiscal incentives. Research limitations/implications The study relies on national-level aggregated data and a single-country setting, which constrains firm-level inference and causal attribution; future research can extend these tests using firm-level data and comparative designs. Practical implications Managers should account for approval-stage dynamics and congestion when planning R&D budgets and application timing; policymakers should consider equity and sector-sensitive programme design to mitigate concentration of fiscal benefits. Originality/value This is a rare longitudinal and multidimensional assessment of a national R&D tax incentive, aligned with the sustainable development goals (SDGs). It provides empirical evidence on the structural determinants and distributional outcomes of SIFIDE, contributing to the debate on entrepreneurship-supporting public policy and bridges innovation-policy evaluation with managerial decision-making. Beyond evaluation, the study challenges assumptions of neutrality and equity, offering insights for scholars, policymakers and practitioners seeking to design more inclusive and strategically aligned innovation and entrepreneurship policies that better serve entrepreneurial SMEs.