Law on the Encouragement of Investment
The Palestinian Authority has created a framework of economic
laws to encourage and support foreign and local investment in Palestine.
The implementing agency is the Palestinian
Investment Promotion Agency (PIPA). These laws were drafted to help protect potential
investors from undue risk and to promote the profitability of their
investment. The Law on Encouragement of Investment encourages capital
investment in all sectors of the Palestinian economy by both local
and foreign corporations registered to do business in Palestine.
The Palestinian Authority hopes that increased capital investment
growth will generate jobs, and help to develop an export-oriented
manufacturing base.
Our incentives policy is dictated by the Law on Encouragement
of Investment in Palestine, 1998. In essence it is as follows:
1. The fixed assets of an enterprise receive various exemptions
on customs duties for a defined period. This law also applies to
spare parts (meeting certain criteria), fixed assets for developing
or enlarging an already existing enterprise, and price increases
due to changes in costs associated with price hikes in the exporting
country, or increases in shipping or transformation costs.
2. Exemptions on income taxes are also granted to investments
of greater than US$100,000, with nominal tax rates applied thereafter
on net profit for a given number of years, based on the size of
the investment.
3. Additional exemptions and incentives may be granted to enterprises
engaged in export activities.
4. Special incentives and exemptions apply to investments in hospitals
and hotels.
For more detail on this law, please contact
us, we will be happy
to assist you.
