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Cabinet approves extension of incentives for SMEs
The cabinet has approved a draft amendment to extend and expand tax deduction incentives for small and medium enterprises. The amendment was proposed by the Ministry of Economic Affairs.
The move means that deductions for corporate income tax, relating to research and development, increased employment and pay raises, could be extended to 31 December 2033. Those deductions are scheduled to become ineffective from 19 May this year under the current act.
The criterion that corporate income tax deductions for increased employment and pay raises only apply when the unemployment rate
reaches 3.78% for six consecutive months will be removed while maximum deduction rates for pay raises are set to be increased from 130% of the extra amount to 150% under the proposed amendment.
The government says the amendment is expected to lead to more than 4,000 new jobs and pay increases for over 5,800 employees.
