Income tax on state-owned enterprises

The Law for the Encouragement of Capital Investments was amended as of 1/1/2011.
For the purposes of the law the country is divided into two areas: A Priority Area (far from the
Centre) and The Centre of the country.
To qualify for any benefits the company has to be an industrial company registered in Israel and has
to prove export capability.
Companies that qualify will be entitled to a lower company tax rates and, if located in the Priority
Area, will also be entitled to an investment grant which will be calculated as a percentage of their approved
investment as indicated below.
Years Company Tax rates Dividend Tax rate Investment Grant
in Priority Area
Centre of the Country Priority Area
2011 & 2012 15% 10% 15% 20%
2013 12.5% 7% 15% 20%
2014 onwards 16% 9% 20% 20%
Super low company tax rate: Companies that meet the following criteria are taxed at an even lower
tax rate: 8% in the centre and 5% in the Priority area.
Criteria:
1. Total annual income in Israel of at least 1.5 billion LIS
2. The combined balance sheet of the company is at least 20 billion LIS.
3. The business plan of the company will include one of the following:
a) Investment in productive equipment of at least 800 million LIS in the centre of the country or
400 million LIS in the Priority Area over a 3 year period.
b) Investment in R&D of at least 150 million NIS in the centre of the country or 100 million LIS in
the Priority Area
c) Employing at least 500 employees in the centre of the country or 250 employees in the Priority
Area
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II.2. ITALY
Targeted corporate income taxes refer to the DIT and the withholding taxes on corporate
reorganizations as described in the explanatory notes of table II.1.
II.2. LATVIA
Microenterprise (small business) tax was introduced in 1st October 2010. Microenterprise tax is set up
with a purpose encouraging business activity and reduce administrative burden for small entrepreneurs.
The tax rate is 9% of turnover. This tax replaced state social contributions both for employees and
proprietors, the business risk state fee as well as personal income tax or corporate income tax depending on
legal form of taxpayer. The legal form of microenterprise could be an individual merchant, an individual
undertaking, a farm or fishing enterprise, as well as a natural person registered as a performer of economic
activity at the State Revenue Service, or a limited liability company. To qualify for the status of
microenterprise taxpayer the following
per month, turnover does not exceed EUR 100 000 per year, and the number of employees does not exceed
five. The revenue from microenterprise tax is transferred as follows: 23.7 per cent, 27.5 per cent or 27.6
per cent to the account of personal income tax (depending on legal type of microenterprise), 72.4 per cent
to the account of social security contributions, 3.8 per cent to the account of corporate income tax and 0,1
per cent to the account of risk duty of business.
II.2. MEXICO
Special Tax Treatment by Sector and Targeted Activities 2000 2016
Year
Reduction in income tax for non-exempt
income from agricultural activities, cattle
raising, forestry or fishing (corporations)1/
Tax reduction for book
publishers, individuals and
corporations
Applicable rate (%)
2000 50.0% 50.0%
2001 50.0% 50.0%
2002 50.0% 50.0%
2003 50.0% 50.0%
2004 50.0% 40.0%
2005 46.7% 30.0%
2006 44.8% 20.0%
2007 32.1% 10.0%
2008 32.1% N.A.
2009 32.1% N.A.
2010 30.0% N.A.
2011 30.0% N.A.
2012 30.0% N.A.
2013 30.0% N.A.
2014 30.0% N.A.
2015 30.0% N.A.
2016 30.0% N.A.
Notes: N.A. not applicable indicating that this disposition did not exist in the corresponding year,
1/In 2000 and 2001 the general reduction was 50%, and it was 25% if taxpayers industrialized their products.
Source: Mexican Income Tax Law, 2000 to 2016.
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II.2. NETHERLANDS
In 2000 a reduced rate was introduced for small and medium enterprises. In 2000-2006 the reduced
rate applies to the first EUR 22 689 (NLG 50 000 in 2001 and 2000) of taxable corporate income. In 2007
an additional bracket was introduced. For that year, a reduced rate of 20% was levied on the first EUR 25
000 of taxable income. Between EUR 25 000 and EUR 60 000 of taxable income, the applicable rate was
ow the thresholds and
statutory rates from 2006 to present:
The following tables show the thresholds and statutory rates from 2006 to 2014:
2006 2007
threshold statutory rate threshold statutory rate
0 22689 25,5% 0 25000 20%
22689 – over 29,6% 25000 60000 23,5%
60000 over 25,5%
2008 2009 – 2010
threshold statutory rate threshold statutory rate
0 275000 20,0% 0 200000 20%
275000 over 29,6% 200000 over 25,5%
2011 – present
threshold statutory rate
0 200000 20,0%
200000 over 25,0%
II.2. NORWAY
Norway has a special tax regime for the shipping industry. There is a zero rate corporate tax on
earnings from shipping activities (a tax on net tonnage applies). When earnings are distributed to
individuals, the normal 27 % personal dividend tax rate applies (dividends paid to corporations are tax
exempt in Norway). The resource rent from hydroelectric power production and petroleum exploitation is
subject to an extra resource rent tax in addition to the normal 27 % corporate tax rate. The resource rent tax
rate is 31 % for hydroelectric production and 51 % for petroleum production, for profits above a certain
level.
II.2. PORTUGAL
Since the 1988 direct taxation reform, the general corporate tax rate has been gradually reduced from
36,5% to 25%. From 2009 onwards, two general tax rates are applied at a Central Government Level. A
ax rate will be
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