Digital Transformation Ministry mulling introduction of IP-Box tax benefits for IT, high-tech sector
The Ministry of Digital Transformation of Ukraine has offered the industry to introduce IP-Box (Intellectual Property Box), a special preferential regime, which allows reducing tax burden on companies that create and use intellectual property objects (patents, software, etc.), in particular for companies.
"We continue to search for the best form of taxation, we are ready to offer for discussion a different format that will create comfortable conditions not only for the IT industry, but also for workers in all creative and knowledge-intensive areas – the IP-Box mode," the ministry said on the website, noti ITng that such a regime is already operating in 19 countries of Europe.
Instead of lowering the income tax rate, the ministry proposes reducing the amount for which this tax must be paid.
"That is, instead of charging 18% for all the profits of the enterprise, we offer to charge it only for the sum excluding the costs of R&D (Research & Development). The maximum discount can be up to 80%. The same applies to the social security tax: the regime will allow you paying not 22% of the total amount allocated for wages, but only from the amount that will remain after calculating the discount," the ministry said.
The main target audience for the regime are is IT sector, MedTech, high-tech manufacturing, AgroTech, FinTech, as well as other industries that produce intellectual property.
The ministry proposes the introduction of a reduced rate for enterprises on income from the sale/transfer of intellectual property rights, payments under a license agreement, as well as compensation for violation of intellectual property rights.