The Treasury Committee has launched an inquiry into the venture capital industry to discuss its effectiveness and how further innovations can be made.

The committee plans to look at the current tax incentives, which include the enterprise investment scheme (EIS), seed enterprise investment scheme (SEIS), and venture capital trusts (VCTs), and consider any options for change.

It also plans to consider the role of key bodies in the industry, such as the British Business Bank and the Advanced Research and Invention Agency.

The move by the Government comes as it works towards achieving carbon net zero and seeking to pioneer more British innovation in science and technology.

In the March 2022 Spring Statement, the Chancellor announced that research and development tax breaks would be reformed over the next few years. By 2024, the Government aims to increase R&D spending by £5 billion, making the combined funding worth £20bn.

Mel Stride, chair of the committee, said:

"Venture capital has a key role in ensuring innovative UK firms prosper, and we want to make sure the market is working well.

"The Government's plan to enable the UK to continue advancing the frontiers of science and technology, as well as its ambitions on net zero and levelling up, will be boosted if businesses are able to finance their work to achieve international success."

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