Law and regulation of industrial and logistics investment in Slovakia

The special Act No. 57/2018 coll. on regional investment aid and Government Regulation No. 195/2018 Coll., provides support for the implementation of investment plans for industrial production plants, technology centres and business services centres.

The general categories for investment aid in Slovakia include cash grants, income tax relief, contributions to new jobs and discounted transfer of real estate or discounted rent of real estate.

The minimum investment in eligible costs and job creation depends on the form of the requested aid, on the type of production and its reference to priority, and other factors.

In Slovakia, there are several examples of industrial “strategic” parks, which were granted the status of significant investment. In general, to create a “strategic park”, the Slovak government must declare an investment a “significant investment” deemed to be of public interest and require at least 250 hectares for industrial production or services. Usually, a state-owned special purpose vehicle prepares the area for a strategic park, including expropriation of land (if necessary).

Income tax relief, where overall amounts of aid are subject to a maximum investment limit as a percentage of eligible costs, as follows:

In the case of eligible costs of up to EUR 50 million, the maximum amounts are: in Western Slovakia: 45 for small enterprises, 35% for medium enterprises, 25% for large enterprises; and in Central and Eastern Slovakia: 55% for small enterprises, 45% for medium enterprises, 35% for large enterprises.

In the case of eligible costs of over EUR 50 million, the maximum amounts are: in Western Slovakia: 12.5% for part of the eligible costs over EUR 50 million up to EUR 100 million, and 8.5% for part of the eligible costs over EUR 100 million; and in Central and Eastern Slovakia: 17.5% for part of the eligible costs over EUR 50 million and up to EUR 100 million, and 11.9% for part of the eligible costs over EUR 100 million.

To be eligible for the income tax relief, different criteria apply to investment amounts and job creation. The criteria vary depending on “zones” (divided on the basis of the unemployment rate) and whether a particular zone is included in the list of “priority zones” or “other zones”.

Other notable types of support are: a patent box - a special tax treatment that exempts intellectual property income acquired through science and research activities. This treatment provides an exemption from corporate income tax. A super-deduction tool for R&D - a special tax treatment enabling additional deductions of costs for R&D projects.