Everything you need to know about the New Development Law
Important information about the long-awaited changes that the New Development Law will bring were provided by the Deputy Minister of Development during an online discussion organized by Eurobank on Wednesday morning.
The main changes:
- Applications will be open in the first two months of 2022 for all legal entities of every size.
- The applications will be open for 3 months, while the platform remains closed for 1 month after the completion of the applications in order for the evaluation process to take place. This time sequence will be repeated 3 times a year.
- Regarding the total evaluation time, Mr. Papathanasis promised that the whole process will be completed within 60 days, so that the investor knows whether or not he/she can receive the aid and do his/her planning. This will be one of the most important changes, if we take into account that with the old law we had evaluations that lasted 2 years in many cases. The participation of certified auditors in the evaluation, who will be paid by the state, will play an important role in the implementation of this commitment, if the public body cannot process the evaluation within 45 days.
- All companies have the right to participate in the new Development Law, regardless their number of employees and their turnover, with the exception of the individual businesses (self-employed) which are excluded. However, as Mr. Papathanasis said, even the self-employed can claim public support by establishing a single-person IKE, which he said is now extremely simple. Franchise schemes can also be included under certain conditions.
- The amount of grant will be on average increased by 20% compared to the previous Development Law, especially for the areas that have to change their economic model by state order, e.g. for the de-lignification of the country, the subsidy reaches 100%.
Minimum budget limits
- Very small enterprises (up to 10 employees with a turnover of up to 2 million euros): € 150,000
- Small enterprises (up to 50 employees with a turnover of up to 10 million euros): € 250,000
- Medium enterprises (up to 250 employees with a turnover of up to 50 to million euros): € 500,000
- Large companies (over 250 employees with a turnover of over 50 million euros): € 1,000,000
The Deputy Minister pointed out that no expenses are counted before the application is made to the system. "If a company has started the expences before submitting the application for the investment in the Development Law, then the plan will be rejected. When the program opens, then the investor can start the expenses "
Forms of subsidies
The new Development law will provide the following 5 forms of subsidies:
- Exemption fron tax, which consists of the exemption from the payment of income tax applied on earnings befor tax, which arise under the relevant tax legislation, from all the activities of the company. The amount of the tax exemption is calculated as a percentage of the value of the investment plan costs or the value of the new mechanical and other equipment, which is acquired by leasing and constitutes an equal reserve, which is kept in a separate account in the financial their situations.
- Subsidy, which consists of the free provision by the State of a sum of money to cover part of the supported costs of the investment plan and is determined as a percentage of them.
- Leasing subsidy, which consists of the coverage by the State part of the paid installments of leasing, which is concluded for the acquisition of new mechanical and other equipment, is determined as a percentage of the value of their acquisition . The lease subsidy may not exceed 7 years and the term starts from the date of completion of the investment.
- Subsidizing the cost of employment created, which consists of covering by the State part of the wage costs of the new jobs created and related to the investment plan and for which no other state aid is received.
- Business risk financing related to the "New Business" scheme.
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