Investment Incentives

Tunisia Code of Investment Incentives was adopted with an aim of encouraging national as well as foreign investments.

The code grants common incentives in all branches of industry, to the exception of a few sectors, which are subject to specific measures.

Common incentives

The common incentives are of several types, in particular the reduced assessment of benefit or reinvested income, which takes place according to two methods :

1st method : Subscription by the income or the profits of the companies’ registered capital or its capital increase. This subscription gives the advantage of tax exemption up 35% of taxable net incomes or reinvested incomes subject to income tax (IR) or to the corporation tax (IS).

2nd method : The reinvestment of the profits within the company itself grants the following advantages :

  • Partial reduction of the profits reinvested up to 35% of the taxable profits.
  • Customs duties and similar tax exemption or 10% reduction upon the acquisition of equipment for which no equivalent is manufactured locally, imported for the needs of projects stipulated by the Code of Investment Incentives.
  • Suspension of the VAT and similar taxes
  • Suspension of the VAT consumption duty taxes upon the acquisition of equipment necessary for the business manufactured locally

Specific incentives to export

The totally exporting companies are granted the following incentives :

  • Full tax exemption of IR and the IS for the first 10 years, and a reduction of 50% during the following years.
  • Full exemption on reinvested profits and revenue in share subscription or increases of the company’s registered capital
  • Full tax exemption on imported equipment necessary for the business.
  • Possibility of selling on the local market: 30% of production for industrial goods and agricultural products, along with payment of applicable duty and levies. (This rate is set at 50% until June 30th, 2010 by virtue of act 2009 - 35 of June 30th 2009 as amended by Act 2009-82).

Recruitment of foreign management and executive staff

The foreign staff who are in charge of the business can under this scheme :

  • Opt for the flat rate taxation scheme of 20% of gross earning.
  • Import their personal effects and one passenger car free of duty.
  • Contribute to another social security schemes other than that operating in Tunisia.