Republic of Tunisia  | Ministry of Industry, Energy and Mines

Common Incentive

Tax and /or Financial Benefit

Art. 7

  • Tax relief for shareholders up to 35% of profits or net revenue subject to corporate tax or personal income tax.
  • Tax relief on profits reinvested back into the company up to a limit of 35% of taxable corporate profits.
  • Profits that are reinvested are to be recorded in a special investment reserve account under the liabilities column of the balance sheet before the deadline for submission of the definitive tax return relating to profits for the year in which the deduction is taken and added to corporate capital no later than the end of the year in which the reserve is set up.
  • The corporate tax return must include the schedule of investments to be made «and a commitment by those taking advantage of the deduction to follow through with investment by the end of the year in which the reserve is set up».
  • Assets acquired in the framework of investment cannot be sold until at least one year after the date of effective start up of production
  • Capital should not decrease for the first five years following the date on which profits and income have been invested, unless a reduction is required to absorb losses
  • « Subject to the terms of articles 12 and 12a of law n° 89-114 of 30 December 1989, which promulgates the code governing personal income tax and corporate tax, the following items can be deducted from the tax base for both personal income tax and corporate tax: income or profits that are reinvested in acquisition of corporate assets or acquisition/subscription of stock or shares leading to holdings of at least 50% of capital in the framework of voluntary transmission by a company following death, inability to pursue management of the company, or retirement as outlined in article 11a of the tax code for personal income tax and corporate tax as well as in the framework of ongoing activity or transmission as outlined in law n° 95-34 relating to recovery at companies encountering economic difficulties as further elaborated and modified by subsequent texts, up to 35% of income or net profits subject to personal income or corporate tax. These terms do not apply to transactions to acquire or subscribe to stock or shares (in the framework of ongoing activity or transmission as outlined in law n° 95-34 mentioned above) by company directors and by the associate who holds the majority share of capital at the date of acquisition or subscription. Calculation of the rate of holdings for the associate with the majority share in capital takes into account the associate’s direct and indirect holdings as well as those of his or her spouse and adult children. »

Art. 8

    The terms of this article have been modified by article 43 of law n° 2007-70 of 27 December 2007 constituting the 2008 finance law.

Art. 9

  • Exemption from Customs duties and similar taxes and Value-added-tax (VAT at 12%) payments for imported equipment that has no locally manufactured equivalent.
  • Suspension of VAT for locally manufactured equipment purchased before the enterprise enters into production. 
  • Payment of VAT (12%) for locally acquired equipment after production startup activity.