New Investment law: Subsidies of up to 45% for business plans in Crete.
Crete’s advantages are enhanced by investment incentives.
Under the new Investment Incentives Law 4399/2016, Crete enjoys:
- attractive investment incentives of 31.5% or 45% of the total investment cost, according to the area and the size of the company
- The new Law focuses on supporting sustainable investment projects with efficient tax breaks, favorable loans and state aids in selected business activities
The purchase of a building (excluding plot) may be aided by the Investment Law for Small Enterprises in the Region of Crete, of 31,5% ot 45,00%, in condition that, cumulatively, the building:
- is an existing fixed asset of a company
- was running as a business, which has ceased its operation.
- is “off the market” (no electricity and water consumption).
There is also a second subsidy offered, for the upgrade/update of the hotel to modern standards, or the transformation of the building to a hotel.
- According to the investment law, the purchase of a hotel cannot be considered as an investment by its own. The investment project can be the:
- establishment or extension of hotel units of at least three (3) stars
- comprehensive modernization of hotel units which belong or are upgraded to a class of at least three (3) stars
- extension and comprehensive modernization of hotel facilities that have ceased operations, provided that during the cessation period the use of the building has remained unchanged and that through the extension or the comprehensive modernization they are upgraded to a class of at least three (3) stars.
Meaning that the investment project must include expenses for the construction of the facilities and the purchase of the required equipment (machinery, furniture, software etc.). In case of a new business, the investment costs for consultancy and the start-up costs for enterprises under establishment are considered as eligible costs. The project’s budget is the result of the total amount of all those costs.
- The project’s subsidy can range from 31.50% to 45.00% of the approved budget, according to various conditions. After the issue of the Inclusion Decision, according to the law, the subsidy can be received following the implementation and payment of 31.50%, 50.00% and completion (100.00%) of the project.
In regards to an example, lets say you purchase a hotel of 1.250.000 Euro. The cost for the upgrade should be approximately equal to the purchase cost, or bigger. If it is less, the application for the subsidy will not be approved.
Now lets take for example that the upgrade cost is estimated around another 1.000.000 Euro, thus the entire investment plan will cost approximately 2.250.000 Euro.
Once you purchase the building, you will receive the 31.5% of the 50% of the total amount of the investment plan.
Following that, you have up to 5 years to complete the upgrade, which when finished, you will be receiving the remaining subsidy of 31.5% of the remaining 50% of the total amount invested.
Crete offers an ideal environment for investment….
Greece Property News|New Investment law: Subsidies of up to 45% for business plans in Crete