Entrepreneur investing in Kamienna Góra Special Eco nomic Zone for Medium Business acquires the right to benefit from the public aid in the form of tax exemption .
– public aid amounting to 25 percent of capital exp enditures in the conduct of business for at least five years (45 percent and 35 percent in case of small and medium-sized enterprises in the conduct of business for at least three years),
– public aid for creation of new workplaces, mainta ined for at least 5 years, amounting to 25 percent of the value of two years of employme nt costs for newly employed workers (45 percent and 35 percent in case of small and medium-sized enterprises – workplaces maintained for at least three years).
The fixed aid ceilings shall apply in relation to t he total amount of public aid measures for the aided project, regardless of whether that a id comes from local, regional, national or Community sources.
The maximum intensity of regional investment aid is calculated as the ratio of the equivalent gross grant to the costs eligible for ai d, is:
25% – in the areas belonging to the following provi nces: Silesia, Wielkopolska and Silesian (dolnośląskie, wielkopolskie and śląskie districts of Poland)
A new investment should be understood as an investm ent in fixed assets and intangible and legal assets, which relies on creating a new or expanding an existing business, diversification of production of the company by int roducing new additional products, or a fundamental change in the overall production p rocess of an existing business. A new investment should also be considered an investm ent of buying a company, which is in liquidation or would have been closed if it w as not purchased, and the company is bought by an independent investor. Aid intended for replacement investment is not permissible.
For aid to entrepreneurs for the implementation of large investment projects (costs eligible for public aid exceeds 50,000,000 Euro) the maximum amount of aid is determined by the following formula:
I = R x (50 million Euro + 0,5 x B + 0,34 x C)
where the symbols mean:
I – the maximum value of the aid for large investmen t projects,
R – aid intensity for the area of investment location, as determined in a ccordance with paragraph 1,
B – the level of costs eligible for aid, over the eq uivalent of 50 million Euro but not exceeding 100 million Euro,
C – the level of costs eligible for aid exceeding th e equivalent of 100 million Euro.
The basis for the use of public aid is a permit to conduct business within Kamienna Góra Special Economic Zone for Medium Business, pro vided by the management board zone. The permit shall specify the subject and the conditions of the economic activity in the zone (the level of capital expenditures and the level of employment).
The entrepreneur can also gain an exemption from pr operty tax. This decision is released by the municipality in which the investmen t is made.
Time of approving investment aid
Depending on the location and the owner of the prop erty the procedure covering the selling of the ground and granting the permission f or conducting an economic activity within the Kamienna Góra Special Economic Zone for Medium Business lasts from 1 to 3 months. The subjected permission is an admin istrative decision that makes it possible for investors to benefit from public aid i n the form of tax exemption (income tax).
Where is being made the decision of granting the pu blic aid?
The process of making the decision and granting the permission for conducting an economic activity is within the authority of Kamien na Góra SEZ managing board, in accordance with the regulation of the Minister of E conomy at 2 nd July 2009.
The Act on 10th of May 2018 on supporting new investments gives possibility to invest and benefit from the public aid not only at the former area of SEZs, but also at investor’s freely chosen property.
According to the regulations enumerated in the Act dated 10th of May 2018 new investment is an investment in tangible fixed assets or intangible assets connected to the inception of a new investment, increasing the production capacity of an existing company, diversification of the company’s production by introducing previously not produced products or a fundamental change concerning the production process of an existing company.
If the company is going to build a production hall, purchase of a new machine or a technological line, diversification or increase in production capacity; after fulfilling certain criteria it can apply for a decision on support and hence the public aid.
Being granted with the decision on support means exactly the same as receiving public aid in form of a tax exemption on legal and natural entitties. The intensity of the aid depends on the size and the location of the undertaking. For dolnośląskie voivodeship large entrerpeneur can get 25%, medium entrepreneur 35% and small & micro 45% of the expenditures (eligible costs) in form of exemption from income tax.
At the moment, to be granted with the decision on support the entity has to fulfill the qualitative and quantitative criteria. Quantitative criteria – understood as the minimum level of the investment expenditures which depends on the size of the entrepreneur as well as on the unemployment rate in the district.
Quantitative criteria are enumerated in the Coucil of Ministers’ Decree dated 28th August 2018 regarding public aid granted to some entrepreneurs for the implementation of new investments – Table 2 – Qualitative criteria for new investments in the industrial sector. By fulfilling the criteria by the investor implementing a new investment at the given sector it is approved when the investor receives altogether not fewer than 6 points; however, not fewer than 1 point per each criterion.
The Decree dated 28th August 2018 stipulates on which kind of an economic activity the decision on support is not granted, this means on which PKWiU it is not possible to issue the decision.
The income tax exemption is eligible for an entrepreneur only since the month in which he or she incurs investment expenses from the day of getting the decision on support until its expiration. This means that all the costs e.g. cost of building of the production hall, cost connected with the purchase of the fixed assets, intangible assets – can be included to the costs eligible to be covered by the support on new investments only the moment the decision on support has been already issued !
The validity period of the decision on support is 10 years (15 years in case of investments at the area being covered with the borders of SEZ before the Act on supporting new investments came into force – available at the following link: www.mapa.ssemp.pl ).
In order to get the decision on support it is necessary to officially submit filled application form on issuing the decision on support. It is not necessary to attach the business plan; however, preparing such document will allow to avoid detailed questions that we can have. The more data is demanded the process of issuing the decision gets longer.
The application form is to be considered immediately, maximum up to 14 days, under the condition that the application form and demanded attachments are complete and there is no necessity to supplement them.
Below there is a list of attachments to the application form:
– financial report for the last three years,
– entrepreneur’s statement of lack of arrears towards ZUS and US (social insurance institution
& tax office),
– entreprenur’s statement that there have not been undertaken proceedings regarding the declaration of bankruptcy as well as the bankruptcy has not been declared,
– certificate from KRK (national criminal record) the the entrepreneur has not been sentenced (NO criminal record as a result from the article 14 point 2 of the Act),
– fulfilled application form,
– statement on commitment towards signing the contract on provision of paid services with the SEZ’s managing entity,
– commitment towards submitting the information to the SEZ’s headquarter in order to keep the records of support on new investments,
The entrepreneur is obliged to pay to the SEZ’s managing entity every month throughout the whole period of the decision’s validity – this is 10 years (15 years in case of investments at the area being covered with the borders of SEZ before the Act on supporting new investments came into force – available at the following link: www.mapa.ssemp.pl ), the remuneration for the services other than informative, being supportive towards conducting the economic activity on the base of the decision.
The amount of the remuneration is established on the base of the formula and it depends on few factors, among others: size of the entrepreneur, the amount of the declared eligible costs of the new investment as well as the property’s surface.
Simulation of the minimum eligible costs (according to the unemployment rate in Poland at the end of June 2019) that must be incurred by the entrepreneur in the area within the Kamienna Góra Special Economic Zone of Small Entrepreneurship being the responsible entity for issuing (on behalf of the Minister responsible for economy) the decision of support: