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 Home Incentives Benefits Granted to Investments Specific Incentive |  | | | Specific Incentive | | |
Additional financial and tax incentives for the
following priority activities:
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For
companies that export 100% of production
 free trade system
total deduction from
the tax base of income or profits from exports for the first 10 years of
activity, after which the rate falls to 50%
Personal income tax,
after deduction of two thirds of income from exports, notwithstanding the
terms of article 12a of law n° 89-114 of 30 December 1989 promulgating the
code pertaining to personal income tax and corporate tax, subject to the terms
of article 17 of the present code, for income generated starting 1 January
2013
Corporate tax at a rate
of 10% on profits from export, subject to the terms of article 17 of the
present code, for income generated starting 1 January 2013, « including
exceptional profits as outlined in paragraph Ia of article 11 of the code
governing personal income tax and corporate tax, with the same conditions
applying for both ».
NB: « Companies operating prior to 1 January 2013, for which the period of
total deduction of profits or income from export or from their activity has
not expired, continue to benefit from total deduction until the end of the
period set for them, in line with legislation in force before the
above-mentioned date. » |
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Foreign exchange regulations
Legal framework :
law n°76-18 of 21
January 1976, promulgating the foreign exchange code
law n°94-41 of 7 March
1994 governing foreign trade
Incentives :
foreign direct
investment in Tunisia:
Foreign investment can be freely made in Tunisia to set up activities and to
expand. It is however subject to prior authorization for initiatives in
certain sectors (transport, communications, public works, publishing and
advertising…)
foreign
portfolio investments:
Non residents who have made investments, in line with legislation in force,
can freely transfer actual net proceeds and the added value of sale or
liquidation of any capital originally invested with imported foreign currency.
External loans :
Resident companies can freely take out any loans required to do business in
foreign currency from non residents:
- Loan institutions: 10 million dinars per natural year
- Companies: 3 million dinars per natural year
When these involve a duration of more than 12 months, these loans
can be contracted:
- by loan institutions: no ceiling
- by companies: 10 million dinars
In this case, loan institutions and other companies must submit to
prior, voluntary assessment by a rating agency.
Transfers linked to repayment of principal and payment of interest on these
loans can be effected freely.
For more details, consult the central bank of Tunisia site:
www.bct.gov.tn
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Rules concerning foreign staff: recruitment
of foreign supervisory/management staff for companies that export 100% of
production Legal framework:
Article 19 of the
investment incentives code
Decree n°94-79 of 17
January 1994, setting modalities for recruitment by companies that export 100%
of their production of supervisory and foremen staff holding foreign
nationality
Modalities:
Companies that export 100% of their production can recruit foreign executives
and supervisory staff, up to a total of 4 people for each company, after
informing the minister in charge of employment and the professional insertion of
young people. If they want to go beyond this ceiling, companies will have to
carry out a recruiting and Tunisification program approved by the minister in
charge of employment and the professional insertion of young people.
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The decision to
approve or refuse this request is transmitted to the company within two
weeks from the date of submission of the file to the Ministry of
Employment and Vocational Training. |
Preferential tax system for foreign staff:
Foreign staff and investors (or their foreign representatives) in charge of
company management benefit from the following advantages:
payment of a
lump-sum tax contribution at the rate of 20% of gross income as individual
income tax
exemption of customs
duty and taxes in an equivalent amount and of levies due on import of personal
effects and a private car for each person
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Regime for companies exporting a portion of their production
Companies that carry out
export operations can take advantage of the following incentives for as long as
they continue to export, on condition that they keep proper accounts in line
with the corporate accounting system:
Suspension of value added
tax and consumer duty on the goods, products and services required for export
operations
Deduction from the income
tax base of two thirds of income from export, notwithstanding the terms of
article 12a of law n°89-114 of 30 December 1989 promulgating the code pertaining
to personal income tax and corporate tax, on income generated starting 1 January
2011
A corporate tax rate of
10% on profits from export, for profits generated starting 1 January 2011, «
including exceptional profits as outlined in paragraph 1a of article 11 of the
code pertaining to personal income tax and corporate tax, under the same
conditions »
Reimbursement of customs
duty and taxes with a similar effect on raw materials and semi-finished products
imported or acquired on the local market by the company for the manufacture of
goods and products meant for export
Reimbursement of customs
duty and taxes with a similar effect on imported capital goods the equivalent of
which is not manufactured locally, as part of the share of exported goods and
products
Conditions and modalities for taking advantage of this incentive are set by
decree.
Greater flexibility in
the systems for temporary admission or industrial warehousing as outlined in the
customs code for imported goods and products that are to be processed and then
exported anew. To this end, guarantee of import duty and taxes as outlined by
customs legislation is replaced by a lump sum payment in an amount set by decree.
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Regional development zones
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Priority regional development zones |
| Investment premium |
First group:
8% of overall investment (included of working capital), up to a ceiling of
500,000 TD
Second group:
15% of overall investment (included of working capital), up to a ceiling of
1,000,000 TD
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- 25% of overall
investment (included of working capital), up to a ceiling of 1,500,000 TD
- 30% of overall investment for new promoters, up to a ceiling of
2,000,000 TD
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| Services linked to
culture: setting up a theatrical enterprise |
8% of the
cost of the initiative, exclusive of the cost of land |
Services linked to
leisure activities:
- Amusement parks for families and children
- Residential and camping complexes
- Recreational facilities
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15% of the
cost of the initiative, exclusive of the cost of land |
| Premium for State
participation in expenditure for infrastructure |
First group:
25% of amounts committed by the company
Second group:
50% of amounts committed by the company
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85% of amounts committed
by the company
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| Assumption of the
employer’s contribution to the legally constituted social security system (CNSS) |
For the
first group State assumption of a share of this contribution for the first
five years, starting from the date of initial activity.
For the second group State assumption of this
contribution for the first five years, starting from the date of initial
activity and a share of this contribution for an
additional period of five years, as follows:
| Year of
State assumption |
Share of
State assumption |
| 1st year |
100% |
| 2nd year |
80% |
| 3rd year |
60% |
| 4th year |
40% |
| 5th year |
20% |
For priority zones to be encouraged in the context of regional
development, State assumption of this contribution for the first five years (starting
from the date of initial activity) and a share of this contribution for an
additional period of ten years.
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Tax incentives
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Art (23)
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Investments made by companies located in zones being encouraged
in the context of regional development - defined according to activities listed
by decree, in industry, handicrafts, tourism and certain services (also set by
decree) - are eligible for the following incentives:
Under the terms of
articles 12 and 12a of law n°89-114 of 30 December 1989 promulgating the code
pertaining to personal income tax and corporate tax, subscription to initial
capital or capital increases at these companies gives rise to deduction of
income or profits invested from net income or profits subject to tax on personal
income or corporate tax.
Investment made by these companies also gives rise to deduction of profits
invested in the same companies from net profits subject to corporate tax.
Eligibility for these incentives is governed by the conditions outlined in
article 7 of the present code.
« The deduction of income
or profits from such investment from the base for personal income or corporate
tax is as follows:
-For the first group of zones being encouraged in
the context of regional development (list set by decree, in industry,
handicrafts and some services) : total deduction for the first five years,
starting from the date of initial activity, notwithstanding the terms of
articles 12 and 12a of law n° 89-114 of 30 December 1989 promulgating the code
pertaining to taxes on personal income and corporate tax
- For the second group of zones being encouraged in the context of regional
development (list set by decree, in industry, handicrafts and some service
activities): total deduction for the first 10 years, starting from the date of
initial activity, notwithstanding the terms of articles 12 and 12a of law n°
89-114 of 30 December 1989 promulgating the code pertaining to tax on personal
income and corporate tax
- For priority zones being encouraged in the context of regional
development (list set by decree in industry, handicrafts, certain services
and for zones being encouraged in the context of regional development for
tourism): total deduction for the first 10 years, starting from initial
activity, notwithstanding the terms of articles 12 and 12a of law n° 89-114 of
30 December 1989 promulgating the code pertaining to tax on personal income
and corporate tax and up to 50% of income or profits for the next 10 years»
«Exemption from having to
contribute to the fund for promoting housing for wage earners, for the first
five years starting from the date of initial activity, for investment in tourism,
industry, handicrafts and some services in the second group of zones being
encouraged in the context of regional development and in priority zones being
encouraged in the context of regional development, as per the list set by decree»
« Notwithstanding the
terms of articles 12 and 12a of law n° 89-114 of 30 December 1989 promulgating
the code pertaining to tax on personal income and corporate tax, you can deduct
from the base for personal income tax and corporate tax any income or profits
that are reinvested in acquisition of assets in these companies or in the
acquisition/subscription of stock or shares that lead to a minimum 50% holding
in capital in these companies in the framework of ongoing activity or
transmission, as outlined in law n° 95-34 pertaining to recovery at companies
encountering economic difficulties, as further elaborated and modified by
subsequent texts.
These terms do not apply to transactions to acquire or subscribe to stock or
shares in the framework of ongoing activity or transmission as outlined in law
n°95-34 mentioned above, by the directors of the company and by the associate
possessing the majority of capital on the date of acquisition or subscription.
Calculation of the rate of participation of the associate holding the majority
of capital takes into account direct and indirect holdings by the associate as
well as those of the spouse and adult children. »
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Tax and financial
incentives |
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Activities involving initial
processing of agricultural products |
Tax incentives as per article 30
- Subscription to initial capital initial or increase
thereof carries the right to deduct profits or invested income from net income
or profits subject to income or corporate tax
- Deduction of profits that are reinvested in the company, on condition that
minimum taxes are paid
- Reduction of customs duty at a rate of 12%, suspension of VAT and consumer
rates due on import of equipment that has no locally-manufactured equivalent
and suspension of VAT on locally-manufactured equipment
- Deduction from the tax base of income and profits from investments for
individual income and corporate taxes for the first 10 years after effective
start-up of activities
Financial incentives, as per
article 32
- Investment premium, amounting to 7% of the cost of
investment, with a ceiling of 300,000 TD for investments tied to initial
processing of milk
- Premium for studies, representing 1% of the total cost of investment, with a
ceiling of 5000 TD
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| Financial and tax
incentives |
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Art (39) : Total
or partial assumption by the State of expenditure for training
Art (43) : To
better support businesses and make better use of their production capacity, the
State can for a period of five years assume 50% of the employer’s contribution
to the legally constituted social security system, on wages paid to:
- newly set up teams in support of the first team, for those industrial
companies that do not work around the clock
- Tunisian staff holding a diploma of higher education issued at the end of at
least four years of studies after the baccalaureate or an equivalent diploma,
who are hired by companies working in industry, agriculture, fishing, and those
services listed by decree, starting from the date on which the staff member is
recruited for the first time
Art (43) a:
Notwithstanding the terms of the second paragraph of article 43 of the present
code, companies in the private sector working in activities listed in the first
article of the present code are eligible for State assumption of a share of the
employer’s contribution to the legally constituted social security system for a
period of seven years, on wages paid for new recruitment of Tunisian staff
holding a diploma of higher education at the end of at least two years of
studies after the baccalaureate or an equivalent diploma, starting from the date
of recruitment of the staff member for the first time.
The rate of State assumption as mentioned in the first paragraph of this article
is set as follows:
| Year of
State assumption, starting from the date of recruitment |
Rate of
State assumption |
| 1st and 2nd years |
100% |
| 3rd year |
85% |
| 4th year |
70% |
| 5th year |
55% |
| 6th year |
40% |
| 7th year |
25% |
All new recruitments made over the period 1 January 2005 - 31
December 2009 are eligible for this incentive.
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| Capital holdings |
New promoters |
Small businesses |
| in capital risk investment
companies’ capital stock equity |
- Minimum 10% of capital for the 1st portion of
investment, up to 2 million TD
- Minimum 20% of additional capital for the portion >2
million TD
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- 30% of capital for the 1st portion of investment, up
to 1 million TD
- 10% of capital for the portion >2 MDT. |
| in FOPRODI resources |
- Maximum 60% of capital for the 1st portion of investment,
up to 2 million TD
- Maximum 30% of additional capital for the portion >2
million TD
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- 30% of capital for the 1st portion of investment, up to
2
million TD
- 10% of capital for the portion > 2 million TD
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| Promoter’s input |
- Minimum 10% of capital for the 1st portion of
investment, up to 2 million TD
- Minimum 20% of additional capital for the portion >
2 million TD |
The remainder is made up of the
promoter’s and shareholders’ contributions |
| Premium for studies and
technical assistance |
70% of the cost of studies, up to a
ceiling of 20,000 TD |
70% of the cost of studies, up to a
ceiling of 20,000 TD
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| Premium for investment |
10% of the value of equipment, up
to a ceiling of 100,000 TD
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Not eligible |
| Assumption of the cost of
industrial land or premises |
1/3 of the cost of industrial land
or premises, up to a ceiling of 30,000 TD |
Not eligible |
Assumption of the employer’s
contribution to the legally-constituted social security scheme (CNSS)
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For the first five years of actual
activity
New: There exists the possibility of postponing payment of social security
contributions for two years, spreading them out over 36 monthly payments. |
In the framework of regional
development
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New
Promoters
New entrepreneurs with projects
that are estimated to cost 1,000,000 dinars or less can choose between capital
participation aforementioned and a reimbursable grant that does not surpass 60%
of minimum capital, the promoter needs to justify personal assets at least equal
to 10% of project capitalization.
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Tax incentives |
- child care
- education
- scientific teaching and research
- vocational training
- film, theater, television and radio production
- organizing activities for young people
- health and hospital facilities
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Art (49) :
-
Exoneration
of customs duties and equivalent taxes and suspension of VAT on equipment
necessary for the project
- Tax
reduction for subscribers, up to 50% of net profits or income subject to
corporate or personal income tax
- Tax
reduction for companies that reinvest in their own activities, up to 50%
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Total reduction of income and profits, without tax to be paid
having to be below 30% of global income tax for private individuals and 10% of
overall profits for businesses
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- International land transport
- Sea transport
- Air transport
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Art (50) :
Exoneration of customs duty, of
equivalent taxes & of VAT due on imported equipment; and suspension of VAT on
local equipment
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| Land passenger transport |
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Exoneration
of customs duty, equivalent taxes & VAT (10%) for imported equipment that has no
equivalent manufactured locally
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Suspension of VAT for equipment manufactured locally and
acquired prior to initial production
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Payment of VAT (10%) for equipment acquired locally after
start-up of activities financed from initial investment
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Investment to set up industrial zones is eligible for the following incentive: |
Art (51 a):
- Exemption from personal income tax or corporate tax of income or profits
generated by the following activities, for the first five years starting from
initial activity
- State assumption of expenditure for infrastructure in the area surrounding
these zones
Eligibility for these incentives is subject to the promoter’s commitment to:
+ construct and equip structures that provide basic equipment and common
services to those located in the zone
+ ensure maintenance of the zone
+ ensure activity within the zone and marketing thereof both externally and
internally
+ ensure the availability of a sole intermediary for those who have set up
business in the zone
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Companies working in public works and real estate promotion that undertake
infrastructure and collective equipment in the second group of zones and
priority zones being encouraged in the context of regional development |
Art (26) :
- Deduction of 50% of profits from such initiatives from the base for taxes on
personal income and corporate tax
NB: Companies in operation prior to the date on which the terms of this law came
into force for which the period of eligibility for the incentives outlined in
articles 23 and 25 of the investment incentives code has not yet expired, as
well as those companies holding a certificate attesting to submission of a
declaration of intention to invest prior to the entry into force of the terms of
the present law and that begin activity before 31 December 2009 continue to be
eligible for these incentives until the end of the period set for them under
prevailing legislation, prior to the date on which the terms of this law come
into force
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