National Research, Development and Innovation Fund

Business innovation grants funded by the 0.3% Innovációs járulék levy — a mandatory R&D tax returned to businesses via competitive grants. The public-choice problem is direct: firms paying the levy have incentive to capture the grant process, favouring large incumbents over genuinely novel entrants. The phase-out reduces the levy to zero over 5 years, returning 177,200 mFt to private balance sheets where profit-and-loss governs R&D allocation. The levy costs each SZJA payer roughly 12,340 Ft per year.

The Research Component funds competitive academic grants from the Innovációs járulék levy. The knowledge-problem case for state-funded basic research is among the strongest in Austrian economics: basic research has genuine public-good characteristics (non-rival, non-excludable results), long time horizons that private investors cannot underwrite, and positive spillovers across industries. The phase-out is premised on increasing matched private co-funding requirements (years 1–3) and then transitioning universities to endowment-and-tuition models. The 2026 NKFIH programme already includes risk-capital co-funding alongside grants — the direction is correct.

Surplus remittance from the NKFI Fund to the central budget — a mechanical consequence of the Innovációs járulék levy yield exceeding the Fund's annual disbursement capacity. The FSI keeps this line: as long as the levy exists, the surplus flows to the general budget rather than accumulating in a discretionary fund. This line reduces automatically as the levy rate steps down during the phase-out of LXII-E2. No independent reform lever.

The Missions Component was introduced in 2022 as government-directed, mission-oriented R&D funding — the state specifying not just the amount but the research agenda. This is the weakest knowledge-problem case in the Fund: the price signal for which research areas create the most value is precisely what the state lacks access to. Existing commitments are grandfathered within the Research Component envelope; no new mission-directed allocations are made. This allocation costs each SZJA payer roughly 2,447 Ft per year. Eliminate immediately.

NKFIH's administrative costs for managing the grant portfolio — staff, IT, legal, evaluation costs for the Research and Innovation Components. A phase-out tracks the Innovation Component reduction timeline. Administrative costs should contract proportionally as the grant portfolio shrinks; a 20% per year reduction in admin costs tied to the 20% per year grant reduction is the appropriate calibration. The FSI does not propose eliminating NKFIH as an institution — a restructured body overseeing privately co-funded research partnerships remains justified.