Slovakia: Tax-Efficient Sectors
Tax-Privileged Business Sectors
Income tax incentives are available to foreign investors by way of tax credits against future corporate tax liability. Tax credits must be approved in advance by the Economy Ministry, which has the power to limit the credits. These credits can be up to 100% of the tax liability of the first five years after the year in which profit was made for the first time – this continues at 50% of the tax liability for the following five years. There must be a minimum foreign investment of EUR5m to attract tax credits and the date of incorporation also affects the credits available.
The Slovakian government encourages the creation of Industrial Parks, with incentives and subsidies available for companies who would enjoy the benefit of shared costs and resources. Funding for research and development establishments is also available.
Companies can apply for regional aid and this can be for a new business set-up, expansion or diversification. EU legislation excludes the following sectors from applying for such aid:
- Fisheries; and
- The coal industry.
Levels of unemployment in a particular region will determine the amount of aid and the minimum investment required; the minimum investment can range from EUR1m to EUR25m, depending on the type or sector of industry.