The government recently drafted a draft tax incentive system for the industrial sector under a basic requirement that the added value of the product should not be less than 30%. The draft system, obtained by Al Ghad, contains other criteria after realizing the value added requirement of the product, relating to the employment rates of Jordanians and women in the factory and being small and medium enterprises.

The standards also include the supply of foreign currencies from their sales, in addition to the governorate and the least developed region excluding the areas benefiting from the system No. 44 of 2016 "Income Tax Reduction System in the Less Developed Regions" and the areas bordering the Amman Municipality.

The draft law stipulates that the tax incentives for the industrial taxpayer within this system shall not in any case exceed 50% of the tax payable by law under this Law.

The draft system is limited to providing tax incentives to the food products industry, non-alcoholic beverages, mineral water production and other bottled water, leather products and related products, textiles and clothing, wood and wood products, cork and furniture.

It also includes the manufacture of paper, paper and printing products, chemicals, chemical products, pharmaceuticals and pharmaceuticals, rubber and plastics products, other non-metallic products, base metals and the manufacture of melded metal products, equipment, computers and electronic and optical products, as well as the manufacture of electrical equipment, Trailers, fireworks, regular and wheelchairs, jewellery making, ornaments and related items. According to the draft system, the industrialist will be given a number of specific points if the proportion of Jordanian labour during the entire tax period ranges between 40% and 80%, and this rate is raised 10% for each subsequent year.

The industrial taxpayer also gives a number of specific points if the percentage of Jordanian labour of women is not less than 15% of the total employment during the entire tax period, except for the manufacture of leather and related products, textiles and clothing for factories established outside development zones and qualified and development, Not less than 25%.

The taxpayer will give the industrial points a number of specific points if his industrial activity in the least developed provinces excluding the areas benefiting from the system No. 44 of 2016 "Income Tax Reduction System in the Least Developed Areas" and the areas adjacent to the boundaries of the Municipality of Amman.

The taxpayer shall also include if he works in small and medium-sized industries and his sales to the local industry constitute at least 10% of his total sales.

The percentage of purchases of the local company sold shall not be less than 1% of the total purchases during the entire period of the tax period.

It is noteworthy that the small industrial companies according to the definition of the Ministry of Industry, Trade and Supply, which employs workers between 10 and 49 workers and registered capital of 30 thousand dinars and more, while the medium industrial companies are employing between 50 and 249 workers and the capital registered 30 thousand dinars and more. Despite pledges by the government to the parliament and the private sector to approve the system of tax incentives for the industrial sector before the end of last year as an alternative program to exempt income profits from income tax, which has been completed but has not complied with it until now, industrialists said earlier for "tomorrow "He said.

They pointed out that the government's commitment to the existence of this system was in order to pass the current income tax bill without facing any objections by the economic activities, which threatened to take progressive measures if the income tax was raised to 20% without any other tax incentives.

The Minister of Industry, Trade and Development, Dr. Tarik Al-Hammouri, said that the adoption of a system of tax incentives for the industrial sector will be completed in September..

Al-Hammouri told Al-Ghad that the development of a tax incentive system for the industrial sector is a substitute for the export earnings exemption program, which ended at the end of last year, pointing out that there are consultations on this system with the industrial sector.

It is noteworthy that the industrial sector contributes about 7.24% of GDP and employs more than 175 thousand workers, while industrial exports contribute more than 90% of the total national exports at a value of 3.4 billion dinars annually.

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