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Investment Incentive Act

Investment Incentive Act allows entrepreneurs to make use of the benefits, in particular in the form of investment tax benefits on tangible and intangible assets, and the gross salary cost of newly created jobs within 24 months of the project. This benefits are targeting micro, small, medium and large entrepreneurs, with varying degrees and models of benefits regarding the size of the company, the investment amount and the new employees’ number.

Thus, all investors investing in manufacturing and processing activities, research and development activities, business support activities and high value added services activities are supported by this law, for most entrepreneurs are the most significant tax incentives. In practice, this means paying a lower rate or the total exemption from paying income tax depending on the nature of the investment. The total investment aid is calculated as a percentage of the investment value, i.e. it is determined on the basis of the eligible costs of investing in tangible and intangible assets or on the basis of the eligible costs of opening new jobs related to the investment. Maximum intensity of support amounts to 25%, 35%, or 45% of total investment costs, depending on whether the project investment is realized by a small, medium or large entrepreneur.

The incentives defined by this law are the following:

1. Tax aid for micro-entrepreneurs
2. Tax aid for small, medium and large entrepreneurs
3. Support for eligible costs of new jobs related to the investment project
4. Support for justified training costs associated with the investment project

Subsidies may be for:

• Development and innovation activities
• Business support activities i
• High value added services activities
• Capital investment costs within investment projects
• Subsidies for labor intensive investment projects