Investment Incentives Amendment
Prepared amendment to the Investment Incentives Act
Pursuant to the draft amendment to Act No. 72/2000 Coll., on Investment Incentives, in future the investment incentives system will focus more on support for projects with higher value added. What does that mean?
Manufacturing projects
In the case of manufacturing projects, this will lead to stricter conditions for providing investment incentives in the form of testing for higher value added. For recipients of investment incentives, this will introduce the obligation to arrange salaries at least in the amount of the average monthly salary in the given region for at least 80% of employees and, at the same time, to fill 10% of positions with university-educated employees or 2% of positions with research and development employees.
Cash grants for new positions and training and retraining of new employees will newly be provided in districts with an unemployment rate of 7.5% or higher. The benefit of the new system will consist in repeal of the condition requiring creation of 20 new jobs and reduction of the minimum investment amount for small and medium-sized enterprises from CZK 100 million to CZK 50 million.
Technology centres and business support services centres
The new system will favour projects involving technology centres and business support services centres, which should receive cash grants for job creation and for training and retraining of new employees throughout the Czech Republic, except for Prague, in the proposed amount of CZK 200,000 per each newly created job and 25% of training costs. The change in the definition of new jobs should make it possible to transfer employees from production to technology centres and business support services centres, as well as filling of such positions with employees with reduced work time and employees residing long-term in the European Union. The minimum investment and number of new jobs in such centres will be reduced by half for small and medium-sized enterprises.
The prepared amendment to the Investment Incentives Act should come into force in 2019.
Notice: The draft amendment to Act No. 72/2000 Coll., on Investment Incentives is currently in the legislative process. The amendment’s wording and effective date are subject to change.