To ask the Scottish Executive what tax incentives it is considering offering to increase the level of investment in research and development.

We intend to introduce the Small Business Bonus Scheme from 1 April 2008 which could potentially benefit those small businesses engaged in research and development activities in Scotland and provide the opportunity for them to increase their level of investment.

Our aim, in introducing the proposed scheme, is the creation of an environment in which businesses in Scotland can flourish, underpinned by a fair taxation system which targets relief where it is needed most. We shall make a further announcement on the details of the scheme later this year.