Regional Grant Aid (2007 – 2013)
The maximum permitted level of aid in each Polish region is shown on the map of regional aid. From the 1st January 2007 a new map of regional aid is in force for the years 2007 - 2013. In accordance with the map, the basic maximum level of regional public aid is expressed in percentages of the amount of aid which qualifies for the receipt of assistance, amounting to:
1. 50% - in areas belonging to the provinces (województwa) of: Kujawy-Pomerania, Lublin, Lubuskie, Łódź, Malopolska, Opole, Podkarpacie, Podlasie, Warmia - Masuria, Świętokrzyskie;
1. 40% - in the area belonging to the provinces (województwa) of: Lower Silesia, Pomerania, Silesia, West Pomerania, Wielkopolska, and also during the period of 1st January 2007 till 31st December 2010 in the area of the Mazovia province;
3. 30% - in the area belonging to the Mazovia province.
The costs qualifying for cover under regional aid in a SEZ, i.e. costs forming the basis for calculating the maximum amount to be exempted from tax, could be:
- costs of new investment
- costs of work of newly employed workers,
depending on whether the tax exemption is in the form of aid for a new investment or as aid for new workplaces.
There is also the possibility of utilising both forms of aid simultaneously, on a condition that the joint amount of aid does not exceed the permitted maximum in a given investment; so that the maximum aid level is determined by the ratio of the aid’s intensity to the highest level of costs: the new investment, or two year costs of the newly employed staff.
Costs of new investment
- expenditure which make up the costs of realising a new investment, reduced by the deductible input VAT and by excise
duties, if the possibility for the deduction is based on separate provisions, incurred in the area of the after receiving the
permission for operate in SEZ, for:
1. purchase of land or the right to its perpetual use,
2. purchase or acquisition within their own scope of fixed assets on condition of their inclusion, in accordance with
separate provisions, to the estate of the taxpayer,
3. development or modernisation of existing fixed assets,
4. purchase of intangible assets by the transfer of technology through the acquisition of patent rights, licenses, know-how or
unpatented technical knowledge.
Costs linked to the acquisition of assets that are hired or leased, other than land or buildings, can only be taken into consideration, when the hire or lease is in the form of a financial lease and includes the obligation to acquire the assets at the end of the period of hire or leasing.
Fixed assets acquired by entrepreneurs - that are not for small or medium sized businesses - should be new.
The minimal level of investment enabling a firm to utilise the public aid under a SEZ is EUR 100 000.
The cost of work of newly employed staff is the gross cost over a two year period, increased by the mandatory payments linked with their employment, incurred by the employer from their first day of employment.
The maximum level of regional aid which can be granted for the realisation of a large investment project is limited in relation to its basic scope and is calculated by the following formula:
I = R x ( 50 million EUR + 0.5 x B + 0.34 x C),
Where the given symbols are:
I – the maximum amount of aid for a large investment project,
R – intensity of aid (depending on the area in which the investment is to be located),
B – size of the costs qualifying for the allocation of aid, over the equivalent of 50 million EUR – but not exceeding 100 million EUR,
C – size of costs qualifying for the allocation of aid over the amount of 100 million EUR.
A large investment project – is a new investment, undertaken over a period of three years by one or more investors, in the case where fixed assets are linked together, which are economically indivisible and where the qualifying costs for aid are jointly valued at over 50 million EUR, as calculated according to the prices and exchange rates, on the day permission is granted.
In the case of investment projects which do not exceed 50 million EUR, the aid ceiling for small businesses may be raised by 20 percentage points, medium sized businesses may receive aid increased by 10 percentage points.
Small businesses are defined as - a business which employs fewer than 50 workers, the annual turnover of which or the annual balance does not exceed 10 million EUR.
Medium sized businesses – those which are not small businesses, which employ fewer than 250 workers, the annual turnover of which does not exceed 50 million EUR, or whose annual balance does not exceed 43 million EUR.
The method of ascertaining whether a business qualifies in the category of SME (small and medium enterprise) is more complicated. The European Commission has issued a special booklet defining SME (you may downloading it from the bottom of the side).