Sector Incentives

Tax Exemptions

Full exemption for first 15 years followed by partial exemption for next 5 years. Under Article 27, there is exoneration from income taxes for a 20-year period.

Year % of Income Taxable
First 15 Years Total Exoneration
16th Year Onwards Partial Exoneration
First Year End (16th) 15%
Second Year End (17th) 30%
Third Year End (18th) 45%
Fourth Year End (19th) 60%
Fifth Year End (20th) 80%

Accelerated Depreciation

Accelerated Depreciation on peripherals including computers and software:

Category Depreciation Value (Per Year)
Built-up properties 10%
Software 100%
Office equipment 33%
Start-up costs 50%
Development costs 33%
Survey and research costs 100%

Strong Investment Code

Strong investment safeguards under Law on Investment Code 1989 (Modified 2002). Under Article 29 (Investments Oriented Towards Export and Re-export),

Category Exemption Limit
Exemption from customs duty and from income taxes on the import of equipment goods and materials needed in installation, operations and production of the enterprise including among others:

  • Buses assigned for the transportation of personnel, in conformance with the Labor Code;
  • Electrical and sanitary equipment needed in company installations;
  • Devices and equipment intended for company security and surveillance;
100%
Payroll taxes and other direct internal taxes for a period of 15 years 100%
Exemption from audit charges 100%

Note: To qualify for the incentives from the investment code 2002, an investor has to be established in one of the free zones or industrial parks. For investments made outside the free zones or industrial parks, the applicable incentives will vary depending on the impact of the project. The amount of fiscal incentives and duties exemption is not fixed in the code, they are up to # yrs.

Fiscal and Custom Benefits

Under Article 40 (Free Trade Zones), Promoters, operators and users of foreign trade zones (physical persons or corporate bodies) shall be entitled, in addition to the benefits provided for by the Code, to fiscal and customs benefits mentioned in the law on foreign trade zones. Determined on a case by case basis by the Inter Ministerial Commission on investments.

Other Benefits

Category Exemption Limit
Profit and Capital Repatriation 100%
Import Duty on Capital Goods, Office Equipment Exemptions 100%
Taxation on reimbursement of debts incurred abroad 100%