| GENERAL
INVESTMENT ENCOURAGEMENT PROGRAM |
| (pursuant
to Decree No 2002/4367 dated June
10, 2002) |
| Last
updated on March 21, 2005 |
A |
Regional definitions designated
for the incentives |
Priority
Development Regions: These
locations are determined by a Council of Ministers
Decree. The current list is presented in the
table below.
Developed
Regions:
The Developed Regions
are as follow:
Normal
regions: Regions
which fall out of the Developed Regions and
Priority Development Regions are called the
Normal Regions.
B |
Which investments are
subject to the incentives? |
-
Production of goods and services
- Research and development (R&D)
- Environmental protection ,
- Improvement of quality and standards,
- Relocating of facilities in the
developed regions to the regional
development locations or priority
technology areas (these destinations
are determined by Higher Science and
Technology Board-TÜBITAK or Scientific
and Technical Research Council),
- Manufacturing, agro-industry and
mining investments to be realized
in the Priority Development Regions
in compliance with the legislation
on State Encouragements to Investments
C |
Eligibility conditions
for the incentives |
Investment activities
listed above are subject to incentives provided
that the amount of fixed investment cost exceeds
Investors who are granted
the incentive certificates by the relevant
authorities are eligible for the following
incentives:
1 |
Tax exemption from Customs Duties,
Fund Levies and VAT |
Imports and domestic
purchases of machinery and equipment within
the scope of approved machinery and equipment
lists attached to the incentive certificates
are exempt from the Value Added Tax.
In addition, imports
of machinery and equipment within
the scope of approved machinery and equipment
lists attached to the incentive certificates
are exempt from the Customs duties
and levies.
2 |
Credit support from the General
Budget |
| Investment type/areas |
Credit Ceiling |
Credit Re-payment Period
|
Interest Rate (YTL-denominated) |
Investments in line with Regional Development plans |
Minimum of
30% of the fixed investment cost
and
YTL 4.5 million
|
6
years
(No re-payment in the first 3 years)
|
20% |
|
-Research
and development
-Environmental
protection
-Priority
technology
-Investments
to be moved to organized industrial
zones |
Minimum of
50% of the fixed investment cost
and
YTL 400,000 |
5
years (No re-payment in the first year) |
20% |
-Manufacturing,
-Agro-industry and
-Mining
investments to be realized
in the Priority Development Regions |
Minimum
of
50% of the fixed investment cost and
YTL 500,000 |
5
years (No re-payment in the first year) |
20% |
-
Credit
ceiling:
The amount of operating credit cannot
exceed YTL 200,000.
In case an enterprise makes use of
both investment and operating credits,
then total amount of credit cannot
exceed YTL 700,000.
|
iii |
Where
to apply to get credit? |
Enterprises are supposed
to apply to the following designated intermediary
banks:
E |
Where to apply for incentive
certificates? |
i)
Non-FDI companies
which
-will invest in agro-industry
or manufacturing sectors,
-cannot be eligible
for the credit incentives described herein
and
-have a fixed investment
cost less than YTL 4 million
F |
What documents are needed to get
the certificate? |
An investor is to fill
out the following documents so as to get an
incentive certificate:
The respective amounts
for the investments are
-
YTL
200 in the Priority Development Regions:
Once these documents are
submitted to the relevant authorities, the
projects in question are evaluated and granted
an incentive certificate pursuant to the Decree
and the relevant Communiqués.
FDI and non-FDI companies
are treated equally in processing of their
applications.
|
